Should utilities and internet be included in a furnished rental?
For a furnished mid-term rental most landlords include utilities and internet in the rent, because short-stay tenants do not want to open accounts for a few months. Include them as a flat, written part of the rent, put a fair-use cap on heavy items, and keep the bills in your own name. The alternative is to bill the tenant their share, which your state may regulate.
Three ways to handle utilities
| Option | How it works | Good for | Watch out for |
|---|---|---|---|
| Included in rent | You keep the accounts and pay every bill. The lease says utilities and internet are included. | Stays of one to a few months | A high bill is yours unless you cap it |
| Included with a cap | Rent includes utilities up to a stated amount or usage. The tenant pays the overage. | Electric heat, air conditioning, heavy use | You must be able to show the usage and the bill |
| Tenant pays | The tenant opens accounts in their name. | Longer stays | Setup time and deposits for a short stay, and gaps in service |
Many short stays use the first or second option. The general question of who pays is covered in who pays utilities, and the case for putting utilities in the tenant's name for standard leases is in utilities in the tenant's name.
What the lease should say
- List each service included: electric, gas, water, sewer, trash, internet and any streaming accounts.
- State the cap, if any, as a dollar amount per month or a usage amount, and what happens above it.
- Say the internet is for normal household use, and say who sets and keeps the router password.
- Say that the service may have outages beyond your control and that outages do not reduce rent unless the law says so.
- State that you can read meters or review bills to apply the cap.
Example a made-up owner includes utilities up to $200 a month in a furnished rental. In July the electric, gas and water bills total $265. The lease says the tenant pays amounts above $200 within 10 days of receiving a copy of the bills, so the tenant owes $65. The owner keeps the bills as proof.
Whether you can pass utility costs to a tenant, and how, differs by state. Some states limit charging tenants for a shared meter or require a written disclosure. If the unit is on a shared meter, read your state's rule before you split a bill.
Internet: set the expectation
Internet is often the first question from a tenant who works from home or travels for work. Tell them the provider and the plan you pay for, not a promise of a speed you cannot guarantee. Put the account in your name, keep the login to the router with you and give the tenant the guest network name and password. At move-out, reset the password so the next tenant starts clean.
If a provider requires a contract longer than your typical stay, ask the provider about a month-to-month plan or the cost of ending early, and weigh that cost against the rent.
How it shows up in your books
When you pay the utilities yourself, they are rental expenses. The IRS lists utilities among deductible rental expenses in Publication 527. If a tenant reimburses you for part of a bill, record the reimbursement so the expense is not overstated: see recording tenant utility reimbursements. Keep each bill with the property and month it belongs to.
This is general information, not legal or tax advice. Your state, your city and your own documents decide what applies, so confirm with the statute and a local attorney or tax preparer.
How DoorKeeping handles it
DoorKeeping reads your property's bank feed, and its AI reads and codes the utility bills you forward so the expense is on the right property's books and the right Schedule E line. Each property has its own ledger. Anything that moves money waits for your one-tap approval. DoorKeeping never holds your money and sends a payment only when you approve it.
Sources
- IRS Publication 527, Residential Rental Property, read Oct 31, 2026
Questions
- Do I have to include internet in a furnished rental?
- No law requires it, but most mid-term tenants expect it, so state clearly in the lease whether it is included and what plan you provide.
- Can I cap the utilities I include?
- Generally yes, if the lease states the cap and how overage is billed. Check your state for rules on charging tenants for utilities, especially on a shared meter.
- Can I deduct utilities I pay for a tenant?
- Utilities you pay on a rental are generally deductible rental expenses. A tenant's reimbursement is income or an offset, so record it. Ask your tax preparer.