If i moved to a rented house after living 2.5 years in purchase primary property and give it on Rent. Can i continue claim mortgage interest as tax benefit for it?

Forum|Forum|3 years ago
March 12, 2023
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JulieS

We'd love to help you complete your tax return, but need more information. Can you please clarify your question?

Are you saying that you are renting your home to someone else now?

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pandey-sudhakarAuthor

Yes. After living for 2.5 year in that house. We moved to a new rental house ourlself and put that property to someone else. Can i continue claiming Mortgage interest + Property tax benefit for it? Is there any maximum limits on amount which i can claim ?

JohnB5677

If I understand this correctly.

You owned a primary home for 2.5 years.
You moved out of it.
You now rent it to someone else.

If that is correct, yes you can deduct the mortgage interest and real estate taxes. But it won't be as your personal home.

This is a rental property, and it should be posted to Rentals, Royalties, and Farm a Schedule E - Rental

Log into TurboTax

Choose Wages & Income
Scroll down to Rentals, Royalties, and Farm
Select Rental Property and Royalties (Sch E)
Continue through the interview and describe your property.
You will be reporting.
1. Rental income
2. Expenses, this will include the interest and RE Taxes.
3. Depreciation. It is important to include depreciation.
  1. It will give you an additional tax break every year.
  2. It is added back when you sell the property.
  3. It is added back regardless of if you took credit for it or not.

If this does not completely answer your question, please contact us again and provide some additional details.

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Carl11_2

Employee

Mortgage interest for property that you own and lease out to others as rental real estate is claimed/reported on the SCH E. If you work through the program the way it's designed and intended to be used, then while working through the rental expenses section you will be asked for mortgage interest, as well as property taxes and property insurance. I can't stress enough the importance of reading the small print on each and every screen, because it does matter - especially in the tax year you convert the property from personal use to residential rental real estate.