Investment Property Tax Calculator

Calculate taxable rental income after expenses, depreciation, and mortgage interest.
$
$
$
$

Taxable Rental Income

$0.00

Tax Owed

$0.00

Net Income After Tax

$0.00

Tax Breakdown

Rental Income$0.00
Total Deductions- $0.00
Taxable Income$0.00
Tax (22%)$0.00
Effective Tax Rate0.0%

Passive activity loss rules: rental losses up to $25,000 may be deductible if MAGI under $100,000. Phase-out applies $100K-$150K.

Use the Investment Property Tax Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

Our Investment Property Tax Calculator helps you estimate your taxable rental income by factoring in key deductions like expenses, depreciation, and mortgage interest. Understanding these deductions is crucial for maximizing your returns and minimizing your tax liability on rental properties, especially with potential tax law changes affecting 2026 filings.

The calculator works by subtracting operating expenses (e.g., property taxes, insurance, maintenance), deductible mortgage interest, and depreciation from your total rental income. Depreciation is calculated using the Modified Accelerated Cost Recovery System (MACRS) for residential rental property over 27.5 years, assuming a straight-line method.

Remember to keep meticulous records of all income and expenses; incomplete documentation is a common mistake that can lead to missed deductions. Also, be aware of passive activity loss limitations, which might restrict your ability to deduct rental losses against other income if you're not considered a real estate professional.

Example: Calculating Taxable Rental Income for a Single-Family Home

  1. 1 Input your annual rental income ($30,000), total operating expenses ($7,000), annual mortgage interest paid ($8,000), and the depreciable basis of your property ($200,000).
  2. 2 The calculator first determines the annual depreciation ($200,000 / 27.5 years = $7,272.73). Then, it subtracts all deductions from the gross income: $30,000 (income) - $7,000 (expenses) - $8,000 (mortgage interest) - $7,272.73 (depreciation).
  3. 3 Your estimated taxable rental income for the year is $7,727.27. This amount is what you would report on your tax return, subject to your individual tax bracket.
  4. 4 This calculation provides a baseline for your tax planning. Consult with a tax professional for personalized advice, as specific situations and evolving tax laws (including those relevant to 2026) can significantly impact your final tax liability.

Source: CFPB — Owning a Home · Last updated: April 2026

Frequently Asked Questions

How is rental income taxed?
Rental income is taxed as ordinary income at your marginal tax rate. However, you can deduct expenses like mortgage interest, property taxes, insurance, repairs, management fees, and depreciation. Net rental income (after deductions) is what you pay tax on.
How does depreciation work on rental property?
Residential rental property is depreciated over 27.5 years using the straight-line method. Divide the building value (not land) by 27.5 to get the annual deduction. On a building worth $275,000, that is $10,000 per year in tax deductions, even though no cash is spent.
Can rental property losses offset other income?
If your AGI is under $100,000, you can deduct up to $25,000 in rental losses against other income if you actively participate in managing the property. This benefit phases out between $100,000 and $150,000 AGI. Losses exceeding the limit carry forward to future years.

You might also need

Mortgage Calculator 2026 — Payment, Amortization & PMI

Calculate your monthly mortgage payment with taxes, insurance, PMI, and HOA. View full amortization schedule. Free, instant results based on current rates.

FHA Loan Calculator 2026 — MIP, Down Payment & Limits

Calculate FHA loan payments including upfront MIP (1.75%) and annual MIP premiums. See when MIP drops off. Free, instant results based on 2026 FHA limits.

Home Affordability Calculator — How Much House Can You Afford?

Find out how much house you can afford based on income, debts, down payment, and current mortgage rates. Free, instant results with DTI ratio breakdown.