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June 5, 2019
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Question about rental income and if I qualify for not-for-profit since my mortgage is more than my rental income

  • June 5, 2019
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Best answer by Coleen3

Not-for-profit has more to do with the intention rather than actual results. Is the amount your tenant is paying less than you would charge an unrelated person who was willing to pay full rental value? If so, there is no profit motive. You would enter your income on Line 21 1040, deduct you mortgage interest and property taxes on your Schedule A as a second home and your other rental expenses are deductible as a miscellaneous deduction subject to 2% of AGI limitation also on Schedule A.

1 reply

Coleen3Answer
Employee
June 5, 2019

Not-for-profit has more to do with the intention rather than actual results. Is the amount your tenant is paying less than you would charge an unrelated person who was willing to pay full rental value? If so, there is no profit motive. You would enter your income on Line 21 1040, deduct you mortgage interest and property taxes on your Schedule A as a second home and your other rental expenses are deductible as a miscellaneous deduction subject to 2% of AGI limitation also on Schedule A.