Our lawyer Henrique Paslar spoke with Portas, a website specializing in real estate news, about declaring rent payments on income tax returns.
“The amount paid monthly to the property owner does not entitle you to a tax deduction or increase your refund. Even so, taxpayers must report the payments on their tax returns,” explains Henrique.
Even though it does not generate any financial benefit, rent must be declared because the Federal Revenue Service cross-checks the tenant’s data with the property owner’s tax return, who is required to report the amounts received as taxable income. When only one of the parties declares it, inconsistencies arise that can lead to the taxpayer being audited.
