Property Q&A in 95122>Question Details

Wi Guy, Home Seller in 95122

Do I have to make estimated tax payments on rent received even with a negative cash flow?

Asked by Wi Guy, 95122 Thu Jun 17, 2010

I changed jobs and transferred from PA to Wisconsin about a year ago. At the time I was confident that I could/would sell the home but that did not happen. We finally got a renter in the property a few months ago and have a negative cash flow (but at least the bleeding isn't as much as it was).

Do I still have to pay estimated taxes on the money I receive in rent? Bearing in mind the rent I receive is less than what I pay in mortgage plus I pay a percentage to a property management firm.

The next piece of the puzzle is, what happens if I can sell it next year? If I sell at a loss (I put a decent amount down so I'm not overly concerned about having to sell short; but if the economy doesn't really pick up I don't forsee a profit.) am I on the hook for additional taxes because of the negative cash flow this year?

Looking for some advice to keep my head above water AND avoid any surprises next April! THANKS!

Help the community by answering this question:


Talk to your accountant. With negative cash flow I don't see any taxable earnings, but your accountant can confirm that for you are not liable tax wise.
0 votes Thank Flag Link Sat Jun 19, 2010
Hi Wi Guy, Terri answered it well, you need to speak with a qualified tax advisor or CPA. Email me through my Trulia profile if you need a referral. Kind regards.
0 votes Thank Flag Link Fri Jun 18, 2010
This is best answered by your Tax advisor. We are realtors and your tax advisor knows financial status. If you need a referral let us know.
Web Reference:
0 votes Thank Flag Link Thu Jun 17, 2010
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