Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Does the second 1099 have an X in the "Corrected" box? If so, the hill just got a little harder to get over. Your documentation and bank records become all important now. A notarized statement from your renter might also help.
You're fine as long as you can document it. You may have to have a face to face with an IRS person, but do everything you can to document the receivables and you should be fine.
Quote:
Originally Posted by k7baixo
I know I’m not in your shoes but I’ve been through something similar before. The IRS couldn’t have more easy to deal with.
Quote:
Originally Posted by MortonR
Definitely not something I would lose any sleep over.
Quote:
Originally Posted by twingles
We have dealt with the IRS several times on audits. Believe it or not, they are reasonable... There aren't very many places in the country that command $20K a month in rent (if your rental is in one of them, you might have a problem).
Quote:
Originally Posted by K12144
Not to mention... point out to the IRS that it's highly unlikely anyone was paying you $21,000 per month in rent... or even $7000 per month for a full year, unless you were running an assisted-living facility.
Skip the CPA; skip the worry; skip the beating heart and sweaty palms.
You'll do just fine, though, I had better results with my in person meeting than my first attempts at responding to faceless mail inquiries.
Bring or send the the various records people have suggested. Have a photo of the house and address, and when they see it isn't a beach house overlooking Malibu, they'll know which amount of rent is correct.
Last edited by kettlepot; 04-05-2021 at 01:39 AM..
Reason: wording
I'll take a little different approach. Are there any 'questionable' items in your tax return that the IRS could question. If so I would look at cleaning those lines up in your return even if you leave the mention line alone. Once they start looking at a return they can look at the entire return.
Of course if you can document everything in your return you have nothing to worry about. But with this issue I am pretty sure your taxes WILL be looked at. I am not accusing you of not having a squeaky clean tax return. But I have know several folks who got pulled in for one line that the IRS questioned only to have other sections (charitable deductions, home office space, etc) questioned and thrown out or reduced when the taxpayers had been somewhat generous, or loose (as many people are) with those deductions or adjustments.
Rented out my house for the last few months of 2019. Collected $8400 worth of rent. Filed taxes accordingly.
Got a nice letter from the IRS today. Apparently the property management company provided the IRS with an additional 1099 that reported that we collected $84,000(!) of rent for those 4 months.
My wife dug through her email and did in fact find this additional/incorrect 1099 with the $84,000 figure. This came some time after the first/correct 1099.
The property management company is defunct. I've reached out to our old property manager with an old email address, an old cell number, and through FB messenger. No reply as yet.
Very concerned about our ability to get this fixed given that the management company is defunct.
Any suggestions on how to proceed would be greatly appreciated.
Could the property company have tried to steal money by rolling it out to owners renting through them?
If the FIRST 1099 had the inflated number, that old seem the more likely mistake but to get a 2ns/“corrected” one and then have the op any go belly up eels too one isn’t
Depending on the location, that's not true though especially with Air BNBs today. Many homes rent for a few grand a night where I live - a tourist destination.
Exactly. I am shocked when I see how much rent is collected for these single family houses that are rented for parties or special events. The highest I have ever seen was a beautiful house with a gorgeous view of the bay during America's Cup.
What's the square footage of the house and is it located where there is a special view or near the beach?
I wouldn't worry either. I represented myself when our small business went through an intensive in person audit and the IRS agent was smart, decent and logical. They understand that clerical and math errors happen and they are more interested in seeing the money that actually hit your accounts.
Exactly. I am shocked when I see how much rent is collected for these single family houses that are rented for parties or special events. The highest I have ever seen was a beautiful house with a gorgeous view of the bay during America's Cup.
What's the square footage of the house and is it located where there is a special view or near the beach?
Pre-Covid, it wasn't unusual to rent out places near events.
World Series
America's Cup (as you eluded to.)
Superbowl
March Madness
Triathlons
Marathons
USGP's
Premier Soccer
Any other event that draw's a crowd.
Some palatial estates rent out to "Reality TV Shows" These can be $5000/day. (or more.)
Happens all the time, in Rancho Santa Fe.
Back to the OP~ This isn't a "mayday, mayday, mayday" situation.
Had a similar situation and was able to clear it up over the phone.
They could not have been easier to deal with.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
