Everything You Need to Know About Form 8825

8825 form instructions

What is Form 8825?

Form 8825 is documented by the Internal-Revenue Service (IRS). In the United States, IRS is the government agency which collects taxes and are accountable for the enforcement of tax laws. The Rental Real-Estate Income and Expenses of a Partnership of S-Corporation, or more commonly called Form 8825 is a special form that Partnerships and S-corporations use to report their income and deductions from all their rental real-estate activities that take place during an assessment year. Schedule E and Form 8825 are mostly similar in terms of instructions.

How Can You Fill IRS Form 8825 And What Does It Entail?

IRS 8825 is an important form to be filled by partnerships as well as S-corporations engaging in real estate. It’s important to ensure complete transparency and present authentic income and other details. The answers to most of the questions in 8825 tax form are straight and uncomplicated.

  1. Read the form 8825 instructions properly. The instructions are just one page and you can save yourself a lot of trouble if you just take this precaution.
  2. Form 1120-S instructions or Form 1065 instructions have an activity limitation section which can prove quite helpful. Reading Schedule E instruction for Form 1040 can also make the situation easy.
  3. Check the internet for latest examples on special cases on the form.
  4. You have to understand all the possible deductions in IRS Form 8825. Purchasing a tax book can help you understand the different intricacies of rental real estate. The books also contained great examples to facilitate better understanding.
  5. Call the IRS! But you should always be careful with the information you receive or give. Know what you want to ask.
  6. You can also seek advise from a rental property CPA.
  7. There are a lot of online sites selling complete instructions to fill the form, you can save a lot of time by opting for them.

Things That The IRS Keep An Eye Out For

There are certain things which the IRS looks for in Form 8825. Missing information or information that shouldn’t be there being one of them. Avoid using all round figures, this gives the signal that you’re implying certain expenses. Depreciating land, which I’m sure is self-explanatory.

Low rental income also sets IRS off. This may indicate that you’re not charging the right amount for the property or you’re using it for personal reasons.

If the Partnership or S Corporations have multiple rental properties, then they should ensure proper allocation of overheads. You should, of course, write figures which match IRS records which again emphasizes on Genuity.

Easy and secure online tool for filling the 8825 form – https://form-8825.pdffiller.com/. Good luck!