If your lease states that you pay the property tax on your rental home, the IRS will allow you to deduct it on your income tax form, the Real Estate Lawyer website states. Only property taxes local government levies across the board, based on property value count; a special assessment to pave your street or put in a sidewalk isn't deductible. An assessment for maintaining or repairing the street, on the other hand, would be a legitimate deduction.
Several states, such as Indiana, California and Maryland, offer a state income tax deduction to compensate for the effect of property taxes on your rent. In California, for instance, renters can take a standard deduction on their taxes -- $60 for a single person in 2011, for instance -- even if the lease doesn't assign them responsibility for property tax. Indiana in 2011 offered a deduction equal to $3,000 or your year's rent, whichever is less.
If you operate a business out of your home, you may be able to deduct some of your housing expenses from your business income, including a percentage of your rent and utilities. If you use 10 percent of your home exclusively for business, you can deduct 10 percent of allowable expenses. You have to meet a number of requirements to qualify for the deduction, for example that the space is your primary place of business, the central office for your business, or the place you meet clients.
If you itemize deductions, you can deduct any loss of personal property -- furniture, electronics, clothes -- due to fire, storm, shipwreck or theft, the IRS states. If you have insurance and file a claim for the loss, you can still deduct whatever the insurance doesn't cover. You cannot, however, claim a deduction for lost or destroyed cash; insect damage such as clothes eaten by moths or termites in furniture; or plates, glasses or similar items broken in the course of everyday use.