Today TaxMama hears from Sandra in California, who tells us. “I have a client that inherited a house from her father. She kept it as a rental income property. She cleared out all of his possessions from the property and put them in storage. Now she wants me to categorize the on-going storage expense as a rental income deduction. It’s my belief that the initial removal of the property was a legitimate expense, but the continuing storage costs is not a Schedule E expense. Is that correct?”
Dear Sandra,
You’re right. Presently, the storage has nothing to do with the rental operation. This is strictly her dad’s stuff.
If the rental is still part of an open estate (Form 1041), it would be an estate expense. If not, if the rental property has been distributed to the heir(s), it’s strictly personal.
And remember, you can find answers to all kinds of questions about rental expenses and other tax issues, free. Where? Where else? At TaxMama.com.
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