What are some creative (and legitimate) tax deductions a Colorado landlord can take?

I'm understanding that I can give my workmen holiday bonuses for their extraordinary dedication this year, but beyond that, do any of you have any ideas?

Thanks in advance!

I believe you can pay your child to be a model and deduct that expense.

You would need to feature the kid in ads and photos.

Many people buy building materials which they will use in the future...however, now is a poor time to stock up on materials due to higher costs.

Thank you for the ideas thus far. I had not used any of these, but am looking into pre-paying my property taxes, paying my insect service for their yearly promotion for 2021 (paying it in 2020) and checking on pre-paying utilities, if that is allowed with the utility company. I know that 2021 will then look unusually rosy (barring a bunch of tenants not paying due to CoVid) but next year, I will just adjust for that increase.

Dee Ann,

FYI That half roof thing went away. It was great while it lasted. Think quarter roof.

Me? I make decisions based on the taxes RIGHT NOW. With c19 who knows how much profit we'll have in '21?

-Year end bonuses to critical helpers

-Year end catch up on church giving

-special gifts to special religious causes

Note: Indiana took personal church giving deductions away so use your business account.

-prepay property taxes

-Amazon gift cards to use for office supplies, paint brushes, tools, etc

-pre-buy basic materials you know will be used like paint, Allure, ceiling fans...easy to store and does not spoil.

-new phone

-new laptop

-stamps

-car repairs if you use actual, not mileage

PS

We use SHIPPING EASY.com to have tracking on Deposit Settlements and other vital documents. They requires prepay so we'll load up that account.

One year in early December I had a client send me a rather large deposit for a job that wouldn't be starting until sometime in the 1st Q of the next year. He wanted to get in on his books as an expense for the tax year it was written in. Knowing that the check was coming, I had planned to just let in sit unopened until after the new year. Unfortunately, my secretary forgot & deposited it. This meant that I would have nothing scheduled to offset it & I would be stuck with having to deal with almost 100K in pure profit. To avoid having my income incorrectly boosted, I decided to buy some needed vehicles a bit earlier than planned. Basically I bought 2 new trucks & 2 vans paying cash for all of them. I took advantage of the 179 type stimulus program in effect at the time & was able to get a nice tax deduction while at the same time using up the 100K unexpected profit. Once January rolled around, I took out loans on the vehicles & got back most of the 100K. In the end between the stimulus incentive deduction, the debit against the 100K profit, the zero interest vehicle loans, the savings for the current income tax year & the reduction in the next year's estimated quarterly tax payments, I actually made out just fine.

Homer is right...IRC 179 is the landlords best friend after depreciation. it's also every small business's friend. EVERY tax preparer knows it well. nothing clever about it...its what they call black letter law and codified for many years now. it's old and cold and never gets questioned. many ranches, builders, dairies, contractors, small business's with yards use defender style vehicles. they are an essential tool if you are moving materials, personnel, tools...whatever. just don't post your pic with a buck slung over it on facebook and you'll be fine. that said even if you do use it to cart yersef around it can be deducted at some level. read on;

The IRS has two general requirements for business property that is qualified for a Section 179 deduction. To begin, the property (called qualified property) must be tangible, depreciable, personal property acquired for use in the active conduct of a trade or business.

Homer is right...IRC 179 is the landlords best friend after depreciation. it's also every small business's friend. EVERY tax preparer knows it well. nothing clever about it...its what they call black letter law and codified for many years now. it's old and cold and never gets questioned. many ranches, builders, dairies, contractors, small business's with yards use defender style vehicles. they are an essential tool if you are moving materials, personnel, tools...whatever. just don't post your pic with a buck slung over it on facebook and you'll be fine. that said even if you do use it to cart yersef around it can be deducted at some level. read on;

The IRS has two general requirements for business property that is qualified for a Section 179 deduction. To begin, the property (called qualified property) must be tangible, depreciable, personal property acquired for use in the active conduct of a trade or business.

brad-

$3 and change for papers. Only works up to 16 oz. Gives tracking.

Print the prepaid label from my helper's computer and set it out for the mail carrier. No trip to the PO.

Some comments-

Paying kids for child modeling in adds. Your child will have to file a tax return unless the earnings are small. Depending on the payer, Social Security may need to be paid on earnings. Will definitely need to file tax if contributing to his/her Roth IRA.

Prepaying mortgage will not necessarily increase your interest deduction, check with your bank.

As a contractor, if I am loading up and setting staging up twice to do two half roofs, the client will be paying more than one whole roof job.

I asked my CPA last year about Sect 179 for buying a new truck and was told it would be an IRS red flag. I would use the vehicle for both personal & business use, albeit mostly personal use. She advised against it...I can’t decide if she’s helping or hurting me being overly conservative.