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You are here: Experts > Business > Corporate Law > Tax Law (Questions About Taxes) > rental income
Expert: MEdusa - 11/3/2009
Question
QUESTION: Is it possible for state tax departments to track the amount of rental income you gross from a single rental property that is suppose to be filed under a GE tax schedule?
ANSWER: I think you are asking for help to avoid tax? not good.
you should be asking is it possilbe for me to properly submit and file all my taxes... not if the state can catch me if I do somethign wrong.
Please revise and ask a more defined question that seeks specific tax advice. What are you trying to accomplish?
MEdusa.
---------- FOLLOW-UP ----------
QUESTION: Okay! How is rental property income tracked by a state tax department?
Answer
rental income is shown on IRS schedule e and should be aggregated by property.. ie individual building. assuming you have more then one property (maybe in more then one state - trying to read into your questions)...
not getting into passive losses and disallowed carryforwards and all that nice fun stuff, lets assume you have property a, b and c... all with income or not.. does not matter..
they all roll up into the federal form 1040 and the AGI is the basis for tax for almost every single state (most state files only track the aGI and not the line by line components.. states very rarely audit the individual line item detail inherent in the federal AGI number. 35 or so of the 41 states have this system.
depending upon where you live, it is likely that the state has no clue what the individual rental income from property a, b or c is....
Unless, of course, you get subsidies (section 8) or other which tie or track with individual properties.
IF you have rental property in more then one state, you should have a competent cpa doing your returns anyway.
You will also have fun when it comes time to do your gain on sale in the future :)
MEdusa
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