Rental Storage Units

[erchess]

We all know that rentals of homes, even say a mobile home park, would go on Schedule E while rental of personal property such as cars or tools would go on Schedule C. What about rental of mini storage units?

[wvtaxguy]

Schedule E

.....would seem to me to be the correct reporting form. No reason other than E has line for "rents received" and C is "gross receipts or sales".

[erchess]

TY for the Input

Does anyone else have another opinion? The crux would seem to me to be that rental of personal property goes on C while rental of real property goes on E. It would seem to me that the storage units count as real property.

[Kram BergGold]

Suggestion

Look up the depreciation method for storage units. If it is 5 or 7 year property then I would say it is not Schedule E. If it is 39 years then Schedule E.

[Jesse]

I vote for schedule E unless there is some type of material participation.

[Lion]

What Type?

Are you asking about a big piece of land with a large structure on it where I can rent a garage-sized storage room for my stuff? Then, Schedule E sounds right to me; you're renting units of real estate. Or, are you asking about those portable pods that get delivered to my house for me to put my stuff in during remodeling or whatever. Then, I think the pods are personal property and not part of the owner's land, just sitting on the renter's land temporarily.

[BOB W]

The primary difference between Sch E and Sch C is "personal service".........Sch C involves personal service...............

[Jesse]

The primary difference between Sch E and Sch C is "personal service".........Sch C involves personal service...............

Personal service or rental of personal property, correct?

Are you asking about a big piece of land with a large structure on it where I can rent a garage-sized storage room for my stuff? Then, Schedule E sounds right to me; you're renting units of real estate. Or, are you asking about those portable pods that get delivered to my house for me to put my stuff in during remodeling or whatever. Then, I think the pods are personal property and not part of the owner's land, just sitting on the renter's land temporarily.

Good point, if the pods are removable and not real property, I would suggest schedule C. If real property and no material participation I would suggest schedule E.

[erchess]

ok

The storage units are all permanently affixed to the land. They are arranged in clusters of from two to five and they range in size from a one car garage to a not quite two car garage. The owner does personally collect the rent and occasionally cleans the exteriors of the units in addition to keeping the small office tidy. I believe that she spends about 40 hours a week in the office but most of that time she is not doing anything that promotes the business except providing some measure of security by her presence.

[BOB W]

The storage units are all permanently affixed to the land. They are arranged in clusters of from two to five and they range in size from a one car garage to a not quite two car garage. The owner does personally collect the rent and occasionally cleans the exteriors of the units in addition to keeping the small office tidy. I believe that she spends about 40 hours a week in the office but most of that time she is not doing anything that promotes the business except providing some measure of security by her presence.

Providing security could be a service. But If the contract does not include a provision for full time security it seems that it is a rental issue.

What is the reason for her presents, just to sign up new renters?

Who provides the lock? Does the owner or renter open and close the rental boxes?

I'm looking for any type of services and are they material in order to use the boxes.

[JAinNC]

Storage rental

I have a Sch E client who owns 2-3 acres with storage units. Each renter is responsible for his own lock. Per written agreement, If rent goes unpaid for a certain number of weeks or months ???? owner may cut lock and sell contents in storage to replace lost rent. Office is on premise to collect rent and be available for new customers. No service is provided to inside of each unit.

There are security lights and buildings and grounds are maintained as a regular rental expense.

[Roland Slugg]

Schedule E

[ChEAr$]

Based on this information,

The storage units are all permanently affixed to the land. They are arranged in clusters of from two to five and they range in size from a one car garage to a not quite two car garage. The owner does personally collect the rent and occasionally cleans the exteriors of the units in addition to keeping the small office tidy. I believe that she spends about 40 hours a week in the office but most of that time she is not doing anything that promotes the business except providing some measure of security by her presence.

1. personally collects rent,
2. cleans etreirors,
3. maintaining an office and
4. for 40 hours per week,......
5. providing a modicum of security

schedule c.

[BOB W]

1. personally collects rent,
2. cleans etreirors,
3. maintaining an office and
4. for 40 hours per week,......
5. providing a modicum of security

schedule c.

Don't you mean Schedule E ?

[DonPriebe]

What happens when he's not there?

It would seem that proving security for 40 hours a week is not a necessary expense if the place is left unguarded the other 128 hours. Do the bad guys keep bankers' hours? Maintaining the office - what if someone wants to rent a unit on Sunday afternoon? I'd argue that the element of personal service provided is minimal, and the profit comes from the return on investment. (Schedule E).

Slippery slope question - who about the owner of a small apartment complex who happens to live in one of the units and functions as the super 24/7?