Real Estate Tax Deductions Every New Investor Should Know
Your Guide to Keeping More of What You Earn
When you're just starting out as a real estate investor, it's easy to overlook one of the best benefits of owning rental property: tax deductions.
If you're managing your first property—or even your first few—tracking deductions might feel overwhelming. But every dollar you miss at tax time is a dollar lost. And we’re here to help you fix that.
This guide breaks down the most common tax deductions available to real estate investors, so you can stop leaving money on the table.
💡 Why Tax Deductions Matter
Every expense you deduct from your rental income lowers your taxable income. That means:
Less tax owed at the end of the year
Higher overall returns
Smarter reinvestment opportunities
With the right system (like a tracker from RentKit 👀), staying organized is easy—even if you're not a spreadsheet pro.
✅ 1. Mortgage Interest
If you financed your rental property, the interest portion of your mortgage payment is typically fully deductible.
📌 Pro Tip: Your lender will send you a 1098 form at year-end with this amount.
🧾 2. Property Taxes
Real estate taxes paid to local or state governments are deductible, even if they're paid through escrow.
🔧 3. Repairs and Maintenance
Expenses that keep your property in good working condition can be written off in the year they occur.
✔ Examples:
Plumbing fixes
Appliance repairs
Touch-up painting
Roof patching
But be careful: major improvements (like a full kitchen remodel) may have to be depreciated over time instead.
🛡️ 4. Insurance
Landlord insurance premiums—including liability, fire, and flood coverage—are deductible.
📱 5. Utilities
If you pay for water, gas, electric, trash, or internet for your rental unit, those expenses are deductible too.
💼 6. Professional Services
You can deduct fees paid to:
Property managers
Accountants
Real estate attorneys
Legal or eviction services
Tax prep pros
Even digital tools (like RentKit’s trackers and templates) may qualify as a deductible expense!
🚗 7. Travel and Mileage
Do you drive to your property for showings, repairs, or rent collection?
You can deduct:
Standard mileage rate (IRS publishes this annually)
Tolls and parking
Car rentals (if used for business purposes)
📌 Important: Keep a mileage log or use a tracker app.
🧾 8. Depreciation
This is a non-cash deduction that lets you recover the cost of your property over 27.5 years (for residential).
You can also depreciate:
Appliances
HVAC systems
Fencing
Flooring
💡 This deduction is powerful—but complex. A tax professional can help you structure it properly.
🖨 9. Office & Supplies
Even a small home office used exclusively for managing your rentals can qualify.
Other deductible items:
Printer paper
Postage
Notebooks
Office software
RentKit templates 👀
🧠 Final Tips for Staying Tax-Ready
Track everything — ideally in real-time
Save receipts and invoices
Use a dedicated business account/card
Work with a real estate-savvy CPA
📥 Want a Simple Way to Track Your Deductions?
Download our Rental Expense & Deduction Tracker included in the
🧰 Real Estate Investor’s Ultimate Management Kit
✔ Organize income, expenses, receipts, and deductions
✔ Beginner-friendly design
✔ Save hours at tax time