Renting a house and taxes
 

I am pretty sure the answer to this is ultimately gong to be to consult with a tax professional but I figure I would throw it out there just to get some ideas from fellow landlords. So my wife is unable to sell her house and we decided to start renting it last fall. I went to do our taxes (turbo tax is usually pretty solid and easy to use) and it looks like we are going to take a huge loss on our taxes like close to 35% of our rental income every month. I have gone through all the questions but there has to be something I am missing? What is the best way to offset rental income?

One of my friends said to not declare it and not worry about being audited but there has to be a better answer than that.

Publication 527 (2012), Residential Rental Property

Should be a lot of deductions in there, mortgage, depreciation, taxes, etc.

I'd assume you would have to pay tax on a certain amount of the income you receive but certainly not on 100% of the income you receive.

Did you go through these items (or a list like them) already? (I've got no clue whether TT prompts you within the program on all this or if there's something here of value to you)

Real Estate Tax and Rental Property - TurboTax® Tax Tips & Videos

Maybe I am looking at it the wrong way I guess. We wrote her mortgage interest and taxes off last year as well but we were also paying for the house. I guess in theory this is payments we didnt have to make with our own money. TT does do a step by step but about the only thing that we might qualify for is depreciation but the way I am reading that is for replacing and fixing appliances. I just figure we already take a loss on the mortgage payment every month and now it appears to be an additional 300 bucks more a month loss, we just need to get rid of this piece of shit. It's not worth the hassle to have to cover almost half the mortgage every month.

I don't know how it works on a rental, but I'm dealing with something similar. I've sold a house on contract, and have been acting as the bank for the buyer. I only have to claim the interest on her payments, not the whole amount.

Oh, i see what you're saying. Yeah, you're going to get boned probably.