If you earn rental income, the IRS wants to hear about it on Schedule E of your tax return. It is the form where you report income and expenses for each rental property you own. Understanding its categories is not optional — it is the difference between a clean filing and an audit headache.
What Is Schedule E?
Schedule E (Supplemental Income and Loss) is an IRS form attached to your personal tax return. Part I covers rental real estate. You report income and deductible expenses for each property, and the result flows into your overall tax liability.
The IRS Expense Categories
The IRS defines specific categories on Schedule E. Here are the ones that matter most for short-term rental hosts:
- Advertising — Listing fees, photography, marketing costs
- Auto and Travel — Mileage to properties, travel for management purposes
- Cleaning and Maintenance — Turnover cleaning, landscaping, routine upkeep
- Commissions — Property manager fees, platform commissions
- Insurance — Property insurance, liability coverage, umbrella policies
- Legal and Professional Fees — CPA fees, attorney fees, bookkeeping services
- Management Fees — Third-party property management costs
- Mortgage Interest — Interest paid on your property loans
- Repairs — Fixes that restore the property to its original condition
- Supplies — Toiletries, linens, cleaning supplies, kitchen essentials
- Taxes — Property taxes, occupancy taxes, local STR taxes
- Utilities — Electric, gas, water, internet, cable, trash
- Other — Anything that does not fit above (HOA fees, software subscriptions, etc.)
Why This Matters for Your Bookkeeping
Generic accounting software like QuickBooks uses its own categories. At tax time, you or your CPA have to manually map every transaction to Schedule E categories. It is tedious, error-prone, and expensive if you are paying someone by the hour.
Lodgic’s Bookkeeping portal uses IRS Schedule E categories natively. Every transaction you log is already in the right category. When tax season comes, you export a report that maps directly to the form your CPA needs. No translation, no guessing.
Income Categories Too
Schedule E also requires you to report gross rents received. Lodgic tracks rental income by property, broken down by platform (Airbnb, VRBO, direct bookings). Your income numbers are always ready when you need them.
Your books should speak the same language as the IRS. Start your free trial and see how Lodgic makes Schedule E effortless.