Scenerio: four siblings own a rental property together... all monies are put into an account used for rental expenses, etc... one of the owners pays the taxes with his own personal check (not the rental accts) and now wants to be reimbursed... taxes are $800... each ones responsiblility is $200... does he get the full reimbursement of $800... it is confusing to me because if he is given the full amount back then he paid nothing out of his pocket (he is actually getting his share back)... this is a practice that has been going on for a couple of years now and I would really like the correct answer... Sometimes it takes a village to figure something out!!

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Originally Posted by kwhit14613

all monies are put into an account used for rental expenses, etc......one of the owners pays the taxes with his own personal check .taxes are $800...each ones responsiblility is $200....

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This doesn't make sense. If all monies are put into the business account, that would include rents. Then all expenses are paid from that account. So where do you get that each owner's responsibility is $200. The responsibility for the taxes is an expense deducted from the gross income of the property.

The only way any owner is responsible for the taxes is if the rental income doesn't cover the expenses. If that's not the case, then the person who paid the taxes gets reimbursed the full amount.

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Originally Posted by ScottGem

the person who paid the taxes gets reimbursed the full amount.

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Just to be clear - he gets reimbursed the full amount out of the rental property's cash account. The answer would be different if the other three were reimbusrsing him directly (ie. sending cash directly to the one who paid the taxes and bypassing the rental property's account).

Correct, again, the only way he doesn't get fully reimbursed is if the Rental property's cash account doesn't have enough money to cover the expense. If it doesn't, then what really should happen is for all FOUR to put money into the cash account to cover the expense.