Form 1040 vs. Form 1040 Schedule E 2024-2025

Hi everyone, welcome to my channel. If you are a new real estate investor trying to better understand IRS schedule, this video is for you. This video explains how to fill out IRS Schedule E, the tax form landlords use to report their income and deductions to the IRS. So, with that said, if you haven't already subscribed yet, please subscribe and give this video a thumbs up. Now, let's talk about who should file Schedule E. You must file Schedule E if you receive rental income from property that you own as an individual. It doesn't matter whether you own the rental property alone, with your spouse, or with one or more co-owners. However, if you have ownership through a business entity such as partnerships, limited partnerships, multi-member LLCs, and S corporations, you need to file IRS Form 8825. This form is used to report rental real estate income and expenses of a partnership or an S corporation. It is very similar to Schedule E. Individual LLC partnership members or S Corp shareholders are each given a Schedule K-1 by the entity, reporting their individual shares of annual income or loss from the rental activity. These individuals then list this amount on Part 2 of Schedule E, which is on page 2. Also, if your rental activity is classified as a regular business instead of a rental activity, do not file Schedule E. Instead, you need to file Schedule C, which is used to report profit or loss from a business. This will be the case if you provide substantial services to your guests, such as maid service and food service. Completing Schedule E is a pretty straightforward process. You only need to fill out the first page, which is called Part 1. Part 1 is also used for royalties, which have nothing to do...