Do I need to report rental property in Canada to IRS?

[onca]

Hi,

(1) I am a US citizen and my wife is a Canadian citizen.
(2) I am working in US and living in Canada. My wife is living in Canada.
(3) We have owned two houses in Canada. One is principal residence property and one is rental property.
(4) My wife has managed the rental property as a part-time job.
(5) After paying all the expenses including mortgage, there is almost no cash flow from the rental property.

My question: Do I need to report the income and expenses of our rental property when I file US tax return form?

Thank you very much in advance!

onca

[nelsona]

Simply by (1) the answer is yes. You report ALL world income to IRS
By (2) you report all world income to CRA as well.

[onca]

Hi nelsona,

Thank you very much for your reply. I still don’t quite understand this. My wife doesn’t have a full-time job, so she manages this rental property as her part-time job. The rental income is her income. Do I still need to report the rental income in my tax return? Would you please clarify this? Thank you again for your help.

onca

[nelsona]

The rental income is NOT her income, it is joint income, just as the property is, as you say "We have owned two houses in Canada. One is principal residence property and one is rental property"

So be sure to each report half the income and expenses on your Cdn return, so that you can claim half the taxes as well, as a credit on your US return. You have to depreciate as well on US return. You MUST report the income, you can choose whther or not to report the expenses (which of course you should to avoid taxes).


And her managing the rental property is not her "job". It is merely the function of any landlord, which you both are.

You will also have to report half the gains on the rental when you sell it.