Southwestern Management And Realty Team

TOP 10 Tax Deductions for Rental Property Owners

Rental property continues to be one of the most popular investment strategies for protecting and growing your wealth. Along with extra cash flow, rental property investment also opens up doors to new tax advantages. 

In fact, Uncle Sam can become a real estate investor’s best friend, IF the right deductions are used. The trick is understanding what you can, and cannot do — and how to capitalize on it.

Here are 10 tax deductions you’ll want your accountant working on ASAP.

  1. Interest. This is one of the most important deductions for real estate investors. If you’re using some kind of loan to attain properties, the interest you pay every year is a write-off.
  2. Depreciation. The current tax code allows you to claim depreciation on each property for 27.5 years. Claiming depreciation is a powerful tool for mitigating your overall tax burden.
  3. Repairs. SMART does repairs on all of our properties in order to make them into great homes for our tenants. And luckily these repairs are deductible in that tax year. Win-win!
  4. Local travel. If you live within driving distance of your rental properties, travel expenses count as business expenses. Keep track of your mileage, and receipts from renting vehicles.
  5. Long-distance travel. Airfare, hotel stays, and team meetings are all business expenses, and therefore are eligible write-offs.
  6. Home office. If you have an office in your home used solely for business purposes, you can claim part of your home as a business expense. There are strict stipulations surrounding this one—your office must have a door, and it must be exclusively an office. A guest bedroom/office or home gym/office does not qualify.
  7. Employees. The whole purpose of the tax law is to encourage businesses to stimulate the economy. If you hire contractors or have people on staff to make your business run smoothly, you can write it off! The government wants to incentivize you to continue creating jobs.
  8. Casualty losses. This isn’t something you want to plan for, but in the event of a disaster, such as a fire or a flood, the IRS allows you to write a portion off as a loss.
  9. Insurance. Most investors think about building insurance costs into their expenses, but forget that insurance costs are a write off at the end of the year! Again, it’s a business expense, and the government loves to incentivize stimulating the economy!
  10. Professional or legal services. Any fees you pay to a property management company, lawyer or other professionals can be written off as business expenses.


For rental property owners, it’s important to remember there are tons of real estate tax investing benefits at your disposal. The barrier for many is understanding what’s available and how to take advantage of it. Real estate tax benefits are extremely important for investors for long-term wealth. Taking advantage of tax breaks will ensure you stay on the path to financial freedom.

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SMART Rental Qualifications

The following are Southwestern Management And Realty Team’s (SMART) guidelines for renting a property through SMART. Each and every application will be reviewed by a member of SMART and could be adjusted depending on credit/income and the application itself. Please be truthful!

Rental Qualifications

  • Applicant MUST be 18 years or older and application fee is $65.00 per person and is non-refundable.


  • Minimum score of 650
  • No EVICTIONS in the past 5 years
  • No utility collections (gas, power, water)

Income Verification

  • Income MUST be 3 times the monthly rent for good credit 650+ and 4 times if applicant has poor credit but good income.
  • MUST be verifiable
  • MUST be with current employer for at least 6 months.
    **If self-employed—CPA financial statements and/or tax returns are acceptable.

Employment History

(you could be required to show proof if requested, paycheck stubs, etc.)

  • Verifiable employment history for the past 3 years
    **If self-employed/retired/not employed—can verify income with signed tax returns and/or bank statements.

Rental History Verification

  • Verify for the past 3 years
  • Must provide: Landlord Names, and phone number, email (if available) on the online application.

Criminal Background Check

SMART does check—Criminal, Sex Offender and Terrorist database

  • NO sex offenders
  • NO crimes—violent crimes, prostitution, domestic violence, possession of weapons or illegal drugs


MUST be 30 pounds & under & absolutely no violent breeds—ask SMART for the Pet Policy

  • 2 pets max
  • NO ferrets or snakes
  • NO Dangerous, poisonous or illegal pets
  • NO aquariums larger than 10 gallons

Emotional Support pets are NOT considered a Service Animal and not under ADA laws.