Do you ever feel like taxes are too mind-boggling?
Filing taxes as a landlord can seem overwhelming. If you live in San Diego, understanding tax statements and 1099s is important.
What can you do to make your San Diego rental property business more lucrative? Read on for our landlord tax guide.
Understanding Tax Forms
Tax documents are forms that show the following:
- Your income
- Deductions
- Other financial information
They help you report your earnings to the government. There are many types of tax forms, but one of the most common is the 1099 form. In San Diego, many people receive 1099s because they own rental properties from which they collect rent.
The 1099 Filing Process
The process of filing 1099s is simple if you follow a few steps. Here's what to do:
Collect All Your 1099s
By the end of January, make sure you have received all 1099 forms. Property management companies and maintenance companies are required to send them to you by this time.
Review the Information
Check your 1099 forms for any errors. If the income reported is wrong, get in touch with whoever issued it.
Include the Income on Your Tax Return
When filing your tax return, make sure to include all the rental income reported on your 1099s. Set a reminder on your phone if you're worried about missing the filing deadline.
Tax Return Tips for San Diego Landlords
What can landlords do to make taxes easier? Here are a few tips to help you file your taxes smoothly:
Keep Accurate Records
Make sure to track your San Diego rental income and expenses throughout the year. This will make filing much simpler.
Claim All Deductions
Landlords can deduct all kinds of expenses. From repairs to property taxes and beyond, make sure you cover all your bases.
Use Tax Software
Many landlords in San Diego use tax software to help them file their taxes. It guides you through the process and helps you avoid mistakes.
Hire a Tax Professional
If your rental property taxes are complicated, it may be wise to hire a tax pro. They can help you understand the tax filing process and avoid errors.
File Early
Waiting is a recipe for errors and stress. Filing early will give you time to correct any mistakes.
Common Tax Documents Mistakes to Avoid
When filing 1099s or any tax form, there are a few common mistakes you should avoid:
- Missing deadlines: Make sure to file by April 15th to avoid penalties
- Forgetting to report all income: If you received multiple 1099s, make sure to include all of them on your tax return
- Not claiming deductions: Don't forget to claim any deductions landlords can use to lower their tax bill
Understanding Tax Statements and 1099s Is Crucial for Landlords
Working with tax statements and 1099s can make anyone's head spin. Using these landlord tax tricks will help protect your business.
Would you like help running your San Diego rental properties? Contact Penny Realty to see how our property management solutions can help. Since 1965, we've been helping rental property owners like you!
