Outline of taxes if renting condo

Good things:

  • tax writeoff contractors, plumbers, electricians, etc.
  • tax writeoff on necessary and reasonable repairs
  • writeoff utilities
  • writeoff taxes
  • Depreciation (this is the tradeoff for capital gains…) writeoff ($5563 per year… $13,454 if I use the FMV, which is $426/month).
  • Insurance writeoff

Bad Things:

  • can trigger capital gains tax when you sell
  • shouldn’t rent to family or friends

Q: If the depreciation writeoff is so damn huge, given that my condo has gained so much value… would it make sense to sell it, buy it back at the higher price, and then take that depreciation?

 

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