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Posted by Paul Thomas, CPA on March 28, 2008, 9:03 am
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> Retired empty-nest seniors, living in large house on college campus;
> rent out 60% of our residence to students/visiting scholars. Do as
> honest a job as we can of recording and deducting direct expenses of
> rental portion and pro rata portion of indirect expenses.
>
> Recently Norwegian roof rats in garage ate the cruise control wiring and
> hoses on our auto, and did similar damage to the (considerable more
> expensive) car of one of the tenants, who pays a bit extra to park in
> our garage (nasty beasts!).
>
> Cost of subsequent pest control service should clearly be a pro "rat-a"
> deductible item. But, since she's a very good, long-term tenant, we're
> also covering the (substantial) cost of repairs for her car without
> arguing about it.
>
> Anyone think that's also a deductible cost (pro rata or in full)?
> "Repairs" associated with rental of her unit? Casualty loss? Good will
> business cost? Some other label?
It's not a casualty loss. But repairing the tenants stuff (the vehicle) for
damages clearly should be a reasonable business deduction. Same for the
portion of the pest control. Don't know what the lease agreement says, but
if a tree fell through my rental and damaged the tenant's stuff, I'd be on
the hook, if not contractually, then morally.
Your personal expenses would not be deductible.
See if there is any insurance you have that would cover it.
Buy some cats.
--
Paul A. Thomas, CPA
Athens, Georgia
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