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How to make a source file?

How do you make rent your source of income so you can file income taxes?

  • i own a condo and want to rent it out for income purposes... mainly i want to buy another house... so i need to prove i use the condo as a source of income to the lender so, How do you make rent your source of income so you can file income taxes?

  • Answer:

    1. You start renting it out at full market rate. 2. You declare the rent on your tax return (1040 with schedule E). Chances are you will show a loss due to depreciation and the rent being less than your mortgage payment. 3. You show the past tax returns, bank statements and copies of the rent checks (and a copy of the lease) to the lender. Banks appear to want a 2 year history of renting the property before they will give you credit for the "income." Also, your insurance on the property will go up when it's no longer owner occupied. http://homeguides.sfgate.com/use-rental-income-qualify-mortgage-8225.html

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There's no "choice" in declaring your rental income on your taxes. Legally, you MUST do so. You "make it your source of income" by doing exactly that.

You claim the rental income on your taxes. You should have been doing this all along. The new lender will need ot see that rental income for a couple of years....

you report rent income on Sch E with your 1040

You do not do anything "so you can file income taxes". You can file income taxes even without a source of income. To file taxes when some of your income is from rent, you fill out Schedule E and attach it to your regular tax return.

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