What this line means
Fees paid to a property management company or individual for managing your rental property. The standard arrangement is a percentage of collected rent — typically 8% to 12% for long-term rentals, 20% to 30% for short-term rentals. This covers tenant screening, rent collection, maintenance coordination, and day-to-day management. The entire management fee is deductible in the year paid.
Does this apply to you?
- You hired a property management company to handle your rental
- You pay a percentage of rent to someone who manages your property
- You use a short-term rental co-host or management service
- You pay an on-site manager a salary or fee for property oversight
Easy to overlook
Co-hosting fees for short-term rentals are management fees If you hire a co-host on Airbnb or a local management company to handle guest check-ins, cleaning coordination, and guest communication, their fee is a management expense on line 11. These fees often range from 20% to 40% of booking revenue. Some landlords lump this in with commissions on line 8, but the distinction matters: commissions are for securing bookings, management fees are for ongoing operations. 1 IRS Publication 527 — Residential Rental Property
HOA fees with management components belong here If your rental property is in an HOA-managed building or complex, the portion of HOA dues that covers building management, common area maintenance, and property administration is deductible. The full HOA fee is deductible as either a management fee on line 11 or on line 19 (other expenses), depending on what the HOA covers. 2 General filing pattern — self-managed landlords miss deductible management costs
Watch out for this
Double-deducting management fees already netted out of your rent check. Some property managers send you the net amount after deducting their fee. If you report only the net deposit on line 3, you have already accounted for the fee. Either report gross rent on line 3 and the management fee on line 11, or report net rent on line 3 and skip line 11 — but not both.
Footnotes
-
IRS Publication 527, Residential Rental Property, Management Fees. https://www.irs.gov/pub/irs-pdf/p527.pdf ↩
-
IRS Publication 527, Residential Rental Property, Condominium and Cooperative Fees. https://www.irs.gov/pub/irs-pdf/p527.pdf ↩