The biggest expense is the mortgage interest (37% of gross rent) followed by property tax (20%). Then Repairs (4%), Utilities(3%), Supplies(2.5%), Insurance(2.3%), Maintenance (2%), leaving about 30% of the gross rent for the net income. I have a mixture of singles and multis in a small town in NJ. I manage properties myself but hire pros for all the work. 198.35.4.88

Yes, its ok to do that on Schedule E. I've been Landlording for 10 years and I've never used a category called maintenance. I've always called it repairs, but you can call it maintenance if thats what you want to do. It doesn't matter. I don't see the need for both.

Example: Let's say your going to one of your rentals to inspect and do any MAINTENANCE that is needed. During your inspection you discover that a piece of siding is rotten and needs to be replace, or a window payne has been broken and needs to be replaced. Wouldn't that be REPAIRING your property also? Repairing-Maintenance same thing.

Another thing to remember is that some things that are depreciable.

The following is a guide line that my CPA recommended to use in determining items that are depreciable. THIS IS ONLY A GUIDELINE that I use. It doesn't seem to throw up a red flag with the IRS.

Below $150 - Non Depreciable

$150 & Up - Depreciate

Another example: If I purchased a ceiling fan for $49 I would claim the entire amount for the year I purchased it. If I purchase a ceiling fan for $200 I would depreciate it over the XX years as required by the IRS.

Hope this helps. 216.115.133.146

The depreciation is 14% of the gross income so my IRS-reported profit is 16% while the net(actual) profit is 30% of the gross.

Darlene,Waterbug,Kathy:

See Schedule E, expense item 7: Cleaning and maintenance and item 14: Repairs (two different entries).

I agree the difference is somewhat arbitrary, but at the end it doesn't matter so long as the total expenses remain the same. 198.35.4.88

What did you consider as being maintenance verses Repairs? Just curious.

Kathy,

You can not depreciate labor that YOU put into a property, such as painting. You can only depreciate the paint. In MOST situations, your goal should be to depreciate as little as possible.

If you do your taxes yourself, I HIGHLY recommend that you get a tax accountant to do your taxes at least once. You may or may not be reaping all of your tax benefits. 216.115.133.146

In the maintenance, I included labor charges from yard/outside maintenance (cutting grass in summer, shoveling snow in winter, pruning/trimming trees/hedges, spring-fall yard cleaning, etc). 198.35.4.88

That makes sense.

Funny, I call it "Professional Services". Like you said, "it's arbitrary".

Back to your origional question, I don't know what my percentage break down is. I've completely remodeled all of my properties so I'm sure my break down is totally different from yours. 216.115.133.146

It is more attractive to fully expense something in the year that it was bought, repaired, installed, etc. rather than to depreciate it.

Items that must be depreciated are those that add to the life of the property rather than merely maintain its current useful life (these items definitely include appliances, carpet, etc.). These items must be capitalized (= not expensed) and then depreciated over a set number of years according to an IRS schedule.

However, (and futher checking into the appropriate laws are necessary) you may be able to fully expense capital items rather than depreciate them up to $20,000 under a provision called section 179. 24.25.4.113

Kathy, as Josh pointed out, expensing is more beneficial than depreciating. Your last reply almost sounded like you wanted to depreciate more. 207.138.153.34