Rent to own

[Unregistered]

Have a client who was doing a "rent to own" on a rental property. However, she claimed the money she received as "rental income" on her tax return.

What needs to be done to correct the situation?

[Black Bart]

Rent-to-rent in perpetuity

Either get another girlfriend or go halves with her in the business. Either way, stop renting that dang furniture-you'll never get it paid off.

[Snaggletooth]

How Realistic?

Facts and circumstances dictate. (That's a safe statement, right??)

How realistic is this "Rent to Own?" Is this a "Rent to Own" business where most people rent until the property is dilapidated and ownership becomes moot, and the lessor has enough rent to pay for the piece of .... nine times over? Like Bart says, they'll never get it paid off and the lessor knew this from the outset...

Or is it a true Sale with fixed payments over the course of time? If so, amend the return and report on an installment basis.