Minnesota 2008 Certificate of Rent Paid
The CRP’s are here, the CRP’s are here! (Ok, I just had to say it.) Minnesota waits until January 1 to publish the 2008 Certificate of Rent Paid (CRP) forms. Here are the details.
If you owned an investment property in Minnesota during 2008, you are required by law to send each tenant a Certificate of Rent Paid. You can find the form here. Depending upon the tenant’s income, they may be eligible for a tax deduction for a portion of the rent they paid for 2008. Although you must send your tenant this form, this does not affect any Minnesota taxes you pay or anything else. It is simply for the tenants tax reporting purposes.
Like any other government form, the instructions are rather confusing and lengthy. I am not attempting to interpret the instructions for you, but here are some of the tips that I have figured out over the years:
- Do not include any damage deposits, late fees, or other non-rent payments in the total amount. Additionally, I typically only include actual rent paid, not rent billed (or accounts receivable).
- Section 8 or other rent subsidies are not included in the total line on the CRP. Only rent paid by the tenant(s). In Quickbooks, I mark each subsidy payment in the memo field to make this easier at the end of the year.
- Fill in a copy of the form with your business information and make copies to save yourself time when completing many of them. With almost 30 rental units, you can imagine how much time this saves me!
- Alternatively, the Certificate of Rent Paid form comes in a PDF format, so last year I entered my business info once and then simply changed the property and tenant info and printed them out (I am faster at typing than writing!).
- I just wait for past tenants to call me and request them (again, there is no penalty for not sending these forms or for them being late).
- When calculating the total amount, you must divide the total rent paid by the total number of adults (married couples are considered 1 person) in the unit regardless of how much rent each paid. You should then send a form to each adult. This may cause some frustration among roommates, but just tell them you are simply following the instructions.
- To save on postage, I send the CRP and monthly statement in the same envelope.
- Lastly, make a copy of all of them for yourself. I will always get a least 2-3 calls in August (when the tenants turn these in for their taxes) from someone looking for a new copy.
You can purchase software packages or services to do this work for you, but I have always found that they are too expensive. Simply do a couple each night until you have them all finished. Turn the music or TV on and just fill them out!
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Scott,
Isn’t it true that sometimes a tenant can’t use the CPR towards their tax write off’s, if they haven’t paid enough in rent?
Basically, if you already have the “standard” write off amount, you don’t need to file for the tax return, since the amount you’d receive would be lower if you did? Maybe that’s a question for an accountant
Thanks for the reminder Scott. Another thing to add to my “to do list.”
Who do you contact if a Landlord did not send a tenant their copy of CRP? However other tenants have received their copies?
Jane »
I would contact the landlord.
Nice post Scott!
Scott, I have a question. Me and my wife got Married in October and started living together in October. Can we still file our CRP’s Separately if we both together make over the $52,300 limit?
Jonathan »
Great question. I am not sure of the answer. I would check with a CPA for the right answer. I suspect if you are filing separately, you will both be under the $52k limit.
Actually there is a penalty for not having them to your tenant by Jan. 31st it’s $100 and if I was your tenant I would notify them of your illegal actions
Jordan »
Thanks for the update. Who do you contact if you don’t get it?
Scott
Since I am old and my hand shakes so bad that I can’t write anything that can be read, I use my computer and printer to print my CRP’s. I already have all the data (names, addresses, amounts, dates, etc.) in the computer so I just set up a form corresponding to the CRP and I do a mail merge (in Word) to print the appropriate data onto the CRP forms which I have printed out in advance. Once I have it set up the CRP’s print out as fast as the printer can go. And they are readable. In fact, they look pretty professional. I don’t have to look up Pin Numbers or anything like that since they are in the form from previous years. I save the resultant file in case I have to print out another form in August or whenever.
Don »
Great idea.
You need to teach all of us to do it. That would save me a huge amount of time with 28 units.
By the way, I fixed the name!
I have a question about the amount listed on the rent paid form. It’s the weekend so I have yet to speak to my landlord but I pay 630/month for rent so the yearly total should be $7,560. However they list a number that is nearly $2000 below that. Is this a mistake or should I contact them about that? I guess I’m not sure if there is a formula used that comes up with a different number than what I transfer throughout the year. I am going to ask them anyway, but thought I would see what you guys think. It just seems odd too me that rent is quoted at 630/month so it should be 7,560 a year and they list a number different than that. Thanks!
Derek »
The math is pretty simple. You just add up whatever the tenant paid directly. If there are roommates, you divide equally amongst the roommates regardless of who actually paid. You do NOT include any money paid by government agencies or damage deposits, late fees, etc.
Scott,
What would you do about a tenant that didn’t pay in full what they were supposed to for the couple of months they stayed? And now they are coming back to me harrassing me for a certificate of rent paid for something under $600. Should I just fill out the .pdf and send it to him in an email ?
Thanks Scott!
Tom-
I think you just need to lick your sores and send them the CRP. I think you know this, but you should have gone after them for the money while they lived there.
Inorder to avoid the extra income tax (due to the rental investment) pose on me, as the house owner.
Is it lawful or legal to sign an agreement with tenant that
- both owner and renter will not file rental tax to the IRS.
- owner will not provide the CRP to renter.
Pls. advise, thanks!
I really can’t answer that. You should ask your CPA.
Seems illegal if you are trying to avoid paying taxes. Remember that your depreciation on most houses will offset any rental income amounts.
Where can I find CRP’s for 2009? All I find are 2008. When are they published, and why aren’t they available … say … the middle of the year. I would like to send them out in a timely manner.
The state of MN is terrible about getting the CRPs out there. Usually it doesn’t happen until the very last week of the year.
How do I load a Word version of the CRP 2009 form onto my PC so I can do a mail merge from an Excel spreadsheet?
I am not sure there is a Word Version available.
Hello everyone -
I feel your pain when it comes to CRP forms. This is why we developed RentComplete.com, a site that automatically calculates and generates your CRP forms. I would like to invite any of you to a free demo of the software, just stop by http://www.rentcomplete.com and sign up.
Sincerely,
John