How to Write Off Half of Your House When You Buy A Minneapolis Duplex

While most home buyers don’t consider it, there are countless reasons buying a duplex as your primary residence can can be a better finanical decision than buying a single family home. The obvious reasons include higher mortgage interest deductions, depreciation and the rental income that helps for the mortgage.
As we approach the end of the year, however, I am reminded of some of the less obvious benefits. When someone owner occupies a duplex, she can deduct countless expenses related to the half of the property she doesn’t live in on the Schedule E portion of her tax return. For example this may include rental unit expenses like:
  • The cost of paint and repairs
  • Rental license fee
  • One-half of the property tax
  • A portion of her cell phone bill
  • Half of her mortgage interest
  • Half of her homeowners insurance
  • Tenant screening fees
  • Half of the maintenance for the exterior of the house
  • A portion of legal and professional fees
Of course, while these deductions pale in comparison to the big one, depreciation, they do help defray some of the costs associated with being a landlord; costs which couldn’t be deducted on an owner-occupied single family home.