Cash-strapped college and university students are quite innovative when it comes to trying to make a little extra money on the side; whether it be driving for Uber or doing something crazy like this ivy league student who ran a restaurant out of his dorm room.
Students are often unaware of one major tax break that could net them a sizable add-on to their tax refund. Claiming rent on a tax return is something that every student living off-campus should be doing, when applicable.
This lucrative tax break does have one caveat though; a student must have documented rent receipts to show proof of rent paid. This proof must contain the following:
The address of the rental unit to which the rent applies.
The name of the tenants to whom the receipt applies.
The amount and date of each payment received for any rent, deposit, arrears or any other amount paid to the landlord (must specify what the payment was for).
The landlord’s signature.
It is crucial to make sure that the rent receipt contains all of this information; otherwise, they may not meet the legal requirements to be accepted for tax purposes.
Landlords are obligated legally to provide tenants with a rent receipt, if rent has been paid. If a resident requests a receipt and the landlord refuses, the landlord should be politely reminded that it is a requirement. If the request is still declined, the matter may need to be brought before the local Landlord and Tenant Tribunal for assistance.
Student tenants should avoid paying rent in cash because there is no paper trail. In addition, it would be difficult to provide proof of the rental payment, if the landlord refused to produce a rent receipt. If a tenant were to pay by check or an electronic transfer, there would at least be a paper trail showing the money being delivered to the landlord.
In the case of subletting, rent receipts can get tricky. Technically, a sublet agreement is between the primary tenant and the sub-tenant; meaning the landlord has no formal agreement with the sub-tenant. Since the landlord has no contractual obligations to the sub-tenant, the rent receipt should be provided by the primary tenant. However, the landlord would be required to provide the primary tenant with a rent receipt. In this case, it is the primary tenant’s responsibility to ensure the rent is paid and a receipt is issued to the sub-tenant. Some landlords may be accommodating, though, and give the receipt directly to the sub-tenant.
Before tax season arrives, student tenants should make sure they have rent receipts in order to generate some extra cash from a tax refund, when applicable.
SEE ALSO: What To Do If You Have Legal Issues With Your Student Housing Landlord
The Places4Students.com Team