Page 11: Rental & Royalty Income and Expenses

Skip this page if you own no rental property and received no royalties in 2026.

You need this page if you rented out a house, an apartment, a room, land or a home you own — even for part of the year, even at a loss, even to family — or if you received royalties from a book, music or mineral rights.

What this page does. It builds the Schedule E for up to four properties or royalty sources, in columns A to D, together with the purchase details, improvements and any refinance.

Before You Begin

Please gather any records that relate to your rental property or royalty activity, including:

• Rental income records
• Settlement or closing statements from property purchases
• Mortgage interest statements (Form 1098)
• Property tax statements
• Insurance records
• Receipts for repairs and improvements
• Records of rental-related expenses
• Refinance documents, if applicable

Having these items available will make the process much easier and help ensure nothing is overlooked.

Completing the Page

No Rental or Royalty Income?

If neither you nor your spouse received rental or royalty income during the year, simply check the box at the top of the page and continue to the next section of the organizer.

Property Information

Complete a separate column for each property or royalty source.

For each one, provide:

• Taxpayer or Spouse ownership
• Property type
• Ownership percentage
• Whether you actively participated in management
• Property name or street address

Property Types May Include:

• Single-family rental
• Multi-family rental
• Vacation or short-term rental
• Commercial property
• Vacant land
• Royalty property
• Self-rental
• Other income-producing property

If you’re unsure which category applies, select the closest option and include additional details in the comments section.

Rental Activity Days

For rental properties, please provide:

Personal Use Days

Enter the number of days you, family members, or friends used the property for personal purposes.

Rental Days

Enter the number of days the property was rented at a fair market rental rate.

Ownership Dates

If you purchased or sold the property during the year, enter the dates you owned the property.

These details help determine the proper tax treatment of the property.

Rental and Royalty Income

Enter the total income received during the year.

Depending on the type of property, this may include:

• Rental income
• Royalty income
• Additional rental-related income

If you receive royalties rather than rental income, simply complete the sections that apply to your situation.

Rental Expenses

Enter expenses paid during the year to operate and maintain the property.

Common expenses include:

Advertising

• Online rental listings
• Newspaper advertisements
• Marketing costs

Cleaning and Maintenance

• Cleaning services
• Lawn care
• Snow removal
• Routine maintenance

Commissions

• Leasing commissions
• Rental agent commissions

Insurance

• Property insurance
• Liability insurance

Legal and Professional Fees

• Accounting fees
• Legal services
• Property consultation fees

Management Fees

• Property management company fees

Interest

• Mortgage interest
• Other rental-related loan interest

Repairs

• Plumbing repairs
• Appliance repairs
• Painting
• Minor maintenance

Supplies

• Cleaning products
• Maintenance supplies
• Replacement items

Taxes and Licenses

• Property taxes
• Rental licenses
• Local fees

Travel

• Travel related to managing or maintaining the property

Utilities

• Electric
• Water
• Gas
• Trash service
• Internet, if applicable

Other Expenses

Use the “Other” line for expenses that don’t fit one of the listed categories.

Rental Mileage

If you drove your personal vehicle for rental-property purposes, enter the number of miles driven.

Mileage is divided into:

January Through June

Enter miles driven during the first half of the year.

July Through December

Enter miles driven during the second half of the year.

Important

Please enter:

✅ Miles driven

Not:

❌ Dollar amounts

We’ll calculate the deduction based on the applicable mileage rate.

Purchase Information

For each rental property, please provide:

• Purchase price
• Purchase date
• Date first available for rent

Even if you’ve owned the property for many years, we still need this information so depreciation can be calculated correctly.

Improvements

Use this section to list major improvements made to a property.

For each improvement, provide:

• Property designation (A, B, C, or D)
• Description of the improvement
• Cost
• Date completed and placed into service

Examples of Improvements

• New roof
• Kitchen remodel
• Room addition
• HVAC replacement
• New windows
• Deck construction

Up to five improvements may be entered on this page.

Refinanced Property Information

If you refinanced a rental property during the year, please provide:

• Property designation
• Refinance date
• Length of the new loan
• Points paid

This information may affect deductible expenses and amortization calculations.

Common Mistakes to Avoid

Repairs and Improvements Are Different

This is one of the most common areas of confusion.

Repairs keep the property in working condition and are generally deductible in the current year.

Examples:

✅ Fixing a leak

✅ Replacing a broken faucet

✅ Repairing drywall

Improvements add value or extend the property’s useful life and are usually deducted over multiple years.

Examples:

✅ New roof

✅ Kitchen renovation

✅ Room addition

✅ New HVAC system

Please list improvements in the Improvements section rather than under regular expenses.

Personal Use Days Matter

If you personally use a rental property, especially a vacation property, special tax rules may apply.

Be sure to count all personal-use days, including use by:

• Family members
• Friends
• Guests who did not pay fair market rent

Accurate reporting helps ensure the property is treated correctly.

“Available for Rent” Is Different From “Rented”

A property can be available for rent even when it is vacant.

Vacant days while actively marketed for rent are typically not considered personal-use days.

Please provide the information as accurately as possible and we’ll determine the proper treatment.

Mortgage Interest Belongs Here

Mortgage interest related to rental property should be reported on this page.

It should generally not be reported with personal itemized deductions.

Don’t Enter Your Mortgage Payment

Only the interest portion of your mortgage payment is deductible.

The principal portion of the loan payment is not a deductible expense.

Your mortgage statement will typically provide the interest amount needed.

Purchase Information Is Needed Every Year

The property’s purchase price and purchase date are important because depreciation calculations build from that original information.

Even long-held properties require this information to be maintained correctly.

If You Sold a Property

Property sales are handled separately.

If you sold a rental property during the year:

• Note the sale in the comments section
• Provide the settlement statement or closing documents

We’ll review the transaction and determine what additional information is needed.

When You’re Finished

Before moving on, take a few moments to verify that you have:

✓ Listed each rental property or royalty source

✓ Entered rental or royalty income

✓ Included operating expenses

✓ Reported mileage in miles

✓ Provided purchase information

✓ Listed any improvements made during the year

✓ Included refinance information, if applicable

✓ Added notes for any unusual situations

A complete Page 11 helps ensure that your rental activity is reported accurately and that you receive credit for all eligible deductions. If you’re unsure whether an expense is a repair, an improvement, or where something should be reported, simply include a note for us and we’ll be happy to review it with you.