All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

Posts: 1
Registered: ‎04-16-2018

Exception for Non-For-Profit Rental?

I found this statement on another internet site regarding a not-for-profit rental (rent below Fair Market Value):


"If your expenses (mortgage interest plus property taxes) were more than the rent you received, you are not required to report the income."


I am looking for validation of this statement. Does anyone here know where it might be found in the IRS publications? I looked in 527 and 535.


Because of my somewhat complicated filings, the tax amount is a bit higher if I report income with equal offsetting expenses (mortgage interest and property taxes) than if I don't report the income at all. I would like to know if not reporting is a legitimate option.




Associate (Neighbor)
Posts: 212
Registered: ‎07-22-2014

Re: Exception for Non-For-Profit Rental?

Hello, rwbrown900, and welcome to the community.


I don't know what website you found that statement on, but I definitely wouldn't rely on it for tax advice!  According to page 16 of IRS Pub 527, you should report the not-for-profit rental income on Line 21 of Form 1040 (other income).


Expenses which offset the income (mortgage interest, property tax, any utilities you paid, etc.) in the "Miscellaneous itemized deductions" section of Schedule A.  Since entries in this section only help to the extent that exceed 2% of your adjusted gross income, that will increase your taxes slightly.


Sorry to be the bearer of bad news...