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Insurance and Taxes

What category would I log the $$ amount listed on my insurance invoice for my rental property monthly insurance premium? Do I add it all up and list it as Renta. Property Insurance Expenses or is the $xx.xx on the invoice for taxes are categorized separately? Thank you :-) (sorry for the new guy questions)

Best Answer

  • FrankxFrankx SuperUser ✭✭✭✭✭
    edited September 2020 Accepted Answer
    Thanks for the additional information.  

    From what you have said, it appears that you are currently allocating the insurance payments among the various rental properties correctly.  The "tax purposes" goal (as you refer to it) is - in Quicken - the same as the "accounting" goal - one follows the other.  So, if you allocate a payment for insurance coverage that applies to a number of properties in Quicken to each property, that will properly record the expense for both "accounting" purposes and for "tax" purposes.  Saying it a little differently - you don't need to do anything more to cover both accounting and tax reporting in Quicken, if you are a US cash-basis taxpayer (which virtually all US individuals are).

    Hope this helps.

    Frankx


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Answers

  • FrankxFrankx SuperUser ✭✭✭✭✭
    Hi @Ahmed,

    No need to apologize for being a "new guy" - there are plenty of new folks here!.

    The important point is that the insurance premiums that you pay for a rental property, are recorded as deductible expenses for the underlying rental property for tax purposes.  So you should make sure that the portion of any invoice for property insurance that relates to a rental property, is properly applied - in Quicken - to that rental property.
    To do that, you may need to allocate an insurance premium payment to both "personal" and "rental" categories.  Also - how/when you will record it depends on whether you are paying monthly or annual payments for the insurance coverage.

    Let me know if you have any follow-up questions.

    Frankx


    Quicken H&B-Subscription - Ver. R29.20 - Build 27.1.29.20  - Windows 10 Home - Ver. 2004
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -
  • AhmedAhmed Member ✭✭
    Thank you. I pay and record monthly. I guess it is the "taxes purposes" is what worries me the most. What is the appropriate category/setup in Quicken so the insurance premiums are logged correctly. Sometimes I wish there were more YouTube videos that are questions specific lol.

    Right now I have it set up as;

    Category: Rental Insurance (Rental)
    and each line is tagged with the correct property. But I am assuming there is more to do for the "tax purposes" goal.
  • FrankxFrankx SuperUser ✭✭✭✭✭
    edited September 2020 Accepted Answer
    Thanks for the additional information.  

    From what you have said, it appears that you are currently allocating the insurance payments among the various rental properties correctly.  The "tax purposes" goal (as you refer to it) is - in Quicken - the same as the "accounting" goal - one follows the other.  So, if you allocate a payment for insurance coverage that applies to a number of properties in Quicken to each property, that will properly record the expense for both "accounting" purposes and for "tax" purposes.  Saying it a little differently - you don't need to do anything more to cover both accounting and tax reporting in Quicken, if you are a US cash-basis taxpayer (which virtually all US individuals are).

    Hope this helps.

    Frankx


    Quicken H&B-Subscription - Ver. R29.20 - Build 27.1.29.20  - Windows 10 Home - Ver. 2004
                                             - - - - Quicken User since 1984 - - - 
      -  If you find this reply helpful, please click "Helpful" (below), so others will know! Thank you.  -
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