A question from an investor:
One of my tenants is a licensed electrician and is willing and able to do small jobs for me around my new rental property. Everything will be done to code and with the proper permits.
If he does the work for me, should I let him pay less in rent that month to cover the balance, or should I handle the rent and the payment for services as completely separate?
I can see the pluses and minuses each way, but it does seem silly for me to hand him $200 so he can turn around and hand it right back to me. I will definitely get an invoice either way so I have it for tax purposes. Any thoughts or issues I may not be considering?
It’s great to have someone handy enough to solve some problems.
Especially someone licensed at that.
While it will make your life easier, you need to manage the situation professionally to prevent being taken for a ride.
We would definitely involve him in these projects but only with your approval and after getting another quote.
Create A Paper Trail
With today’s technologies, you should get videos or photos sent of the problem before any work is done. Set a monthly limit to how much you spend with him.
Pay him separately after receiving an invoice, photos, videos and receipts for any materials. Collect the full rent as usual since your accounting will become ugly if you just subtract the repairs from the rent. Then issue a 1099 at the end of the year if the payments exceed $600.
We have many handy residents in Bridgeport Connecticut. They take pride in the property when they know they can fix something for payment.
The owners are happy and the residents are happy that maintenance is done quickly.