How to file Foreign rental property with Foreign tax credit – if United State citizen, have a rental income from abroad, in turbotax , where should be add income? business or personal section?

For a US citizen with rental income from abroad, you should report it in the personal section of TurboTax, not the business section. Here’s why:

  • Rental Income is Considered Personal Income: Even though it’s from abroad, rental income is generally treated as personal income for US tax purposes.
  • TurboTax Categorization: TurboTax doesn’t have a separate section specifically for foreign rental income. It falls under the umbrella of personal income.

Here’s what you’ll likely do in TurboTax:

  1. Navigate to Income Section: Look for the section on “Wages & Income” or similar phrasing.
  2. Rental Property Section: Within the income section, find the area dedicated to reporting rental property income and expenses.
  3. Enter Details: Fill in the details about your foreign rental property, including income received, expenses incurred, and any depreciation deductions you might be eligible for.

Additional Considerations:

  • Foreign Tax Credit: Since you’re paying taxes on this income in another country, you might qualify for a foreign tax credit to avoid double taxation. TurboTax should guide you through this process.
  • Form Selection: Depending on your specific situation and the amount of income, TurboTax might recommend using a specific form for reporting your rental income. Follow the prompts and instructions within the software.

Here are some resources that you might find helpful:

It’s always a good idea to double-check and ensure you’re reporting your income accurately, especially when dealing with foreign income. If you have any concerns or complexities in your tax situation, consider consulting with a tax professional for personalized advice.