Re: Quick question about cleaning - Landlord Forum thread 355070

Re: Quick question about cleaning by Stephen (WA - Washington) on November 13, 2017 @22:25

Remember that whatever you charge for you doing the cleaning needs to be reported on your taxes as income to you.

Example #1, you have a $500 deposit. The only expense is the cleaning you do for which you charge the tenant $100. You return $400. The $100 is income to you. There is no off-setting expense.

Example #2, you have the same $500 deposit. You hire someone to do cleaning for you. You pay them $100. On your Schedule E you include a $100 expense for cleaning. This reduces the profits from the rental and betters your taxes. The person you hired is supposed to report the $100 as income and pay taxes on it.

Example #3, you have the same $500 deposit. You do your own cleaning but don't charge the tenant for it. Down side: you don't punish the tenant. Up side: you don't have additional income to report.

On balance, I haven't figured out whether the income in my pocket after taxes is better under example 1, 2, or 3. My bookkeeper (wife) thinks example 2 is best because then I don't have the wear and tear on me.

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