Which schedule? E or C?

Forum|Forum|3 years ago
May 19, 2022
2 replies
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I am a Realtor and I own rental properties. I advertise both my rentals and my real estate services using flyers, business cards, etc. typically with office depot or somewhere like that. Also I show client houses in the same areas where I have my rentals. While in town, I drop by the rental properties to check up on them.

Where do I write off the advertising and mileage? Schedule E (landlord/rentals) or Schedule C (real estate)?

A CPA told me that schedule E is passive and that you pay FICA on schedule C earnings so it’s best to reduce the adjusted income on schedule C. I don't understand all that so can someone explain it in a bit more detail?

Not A Product Question

Anonymous_

Employee

I am presuming that you file a Schedule C to report the income from your services as a real estate agent or broker and a Schedule E for your rental properties.

If the foregoing is the case, then you will have to allocate the expenses (advertising and mileage) between Schedule C and Schedule E, in accordance with what is attributable to each.

Anonymous_

Employee

@vgentry wrote:
A CPA told me that schedule E is passive and that you pay FICA on schedule C earnings so it’s best to reduce the adjusted income on schedule C.

Your CPA is correct, but you cannot, deduct expenses that are attributable to your rentals, such as advertising for tenants, on Schedule C.