TAX

Rental Property Tax Deductions: The Complete List

Updated March 2026

The Big Ones

Mortgage interest (often your largest deduction), property taxes, insurance premiums, property management fees, repairs and maintenance, and depreciation. These six line items typically account for 85-90% of your total deductions. If you're not tracking these, you're leaving serious money on the table. On a \$200K property with a \$150K mortgage at 7%, your interest deduction alone is roughly \$10,400 in year one.

The Ones Most Landlords Miss

Travel expenses to properties (IRS rate of \$0.70/mile in 2026 — a 30-mile round trip to your rental twice a month is \$504/year in deductions). Home office deduction if you manage from home. Professional development (books, courses, conference attendance). Legal fees for lease preparation or evictions. Accounting and tax preparation fees. Advertising costs for vacancy listings. HOA fees. Pest control. Landscaping. Every dollar you spend operating the property is deductible.

Depreciation: Your Biggest Hidden Deduction

The IRS lets you depreciate residential rental buildings over 27.5 years. On a \$200K property where the building is worth \$160K (land is not depreciable), you get a \$5,818/year paper deduction — reducing your taxable rental income by nearly \$6K even though you didn't spend anything. Cost segregation studies can accelerate this dramatically by reclassifying components as 5, 7, or 15-year property instead of 27.5.

What You Can't Deduct

The purchase price of the property (it's a capital expense, not an operating one). Improvements that add value or extend useful life (these get depreciated, not deducted immediately). Your own labor on the property. Personal use expenses if you sometimes use the property yourself. And fines or penalties — if you get cited for a code violation, that's not deductible.