Owning a rental can be a strong long-term investment—but the expenses add up. The good news is that many costs tied to operating and maintaining a rental may be deductible, depending on your situation and how your CPA classifies them.
This checklist is built for Orange County landlords who want:
- A clean list of common deduction categories
- A simple way to track expenses year-round
- Fewer surprises at tax time
Start With the Two Big Buckets
Most rental expenses fall into one of two categories:
Operating expenses (ongoing):
Costs to run and maintain the property during the year.
Capital improvements (long-term):
Upgrades that extend the life of the property or materially improve it—often depreciated over time
Your CPA decides what belongs where. Your job is to keep documentation organized so the correct treatment is easy.
The Deductions Checklist (Common Categories)
Use this as your “do we have a receipt for that?” list:
- Mortgage interest (and certain loan costs depending on how your CPA treats them)
- Property taxes
- Insurance premiums (landlord policy, umbrella coverage if applicable)
- HOA dues + assessments (especially common for OC condos/townhomes)
- Repairs + maintenance (plumbing, electrical, paint touchups, landscaping, pest control, HVAC service, etc.)
- Owner-paid utilities (water/sewer/trash, gas/electric, common-area utilities)
- Property management fees (management, leasing/renewal, admin fees if charged)
- Advertising/leasing costs (photos, listings, signage, leasing support)
- Professional services (CPA, legal consults, bookkeeping, rental software/tools)
- Travel/mileage (when eligible) for rental activity (track date, purpose, miles)
- Depreciation (building value—not land—over time; CPA sets this up)
Record-Keeping That Makes Tax Time Easy
Treat your rental like a simple business:
- One folder per property (digital)
- Save every invoice + proof of payment
- Add a one-line note: what it was and why it was necessary
- Tag big-ticket work as “review for capital improvement”
- Keep move-in/move-out documentation (photos + inspection notes) to support repair charges tied to tenant damage
Orange County Expense Reminders
- HOA rules + fees: Keep CC&Rs, fee schedules, and notices that affect costs.
- Coastal wear: Salt air can accelerate exterior maintenance—document preventative work.
- Insurance reviews: Re-check coverage annually, especially on higher-value homes.
Want a Realistic Rent Estimate for Your Orange County Property?
Use our free tools to estimate rent, then schedule a quick call to review pricing, costs, and your leasing timeline.
