My CPA doesn’t allow me to take the rental as a business. It has to be taken as a rental deduction. There are a few things that can be expensed out, but not like you could with a business. I ate it big this year. From what I have read on this forum, this is a grey area… A user called @Levee_App are CPAs who specialize in Air returns and advise differently. Perhaps contact them? They said they prepared returns in all 50 states.
TurboTax broke down the short term rental reporting quite nicely this year. Enter number of days rented, percentage of property used for rental, line item expenses, utilities, etc.
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Of course you can claim it as an expense!
We have a local guy we like a lot. It is definitely a business - not rental property. Well, anyway, @Levee_App was helpful, but I wanted to work with someone I could talk to face-to-face.
@dcmooney, Yikes, I don’t declare a self employment tax on abb income! At least I don’t think I do, my CPA does my taxes, I just report to that office my earnings (from the website form), and any deductions against it! I may make a July appt with my CPA to go over my taxes again. I did that the first year I started renting on ABB just to make sure I was on track of having enough taxes taken out of my paycheck. Before I started with ABB I was doing my own taxes, because it was easy peasy, I didn’t own a house, so couldn’t itemize.
Don’t panic, I’m sure your CPA would take care of this. If, on paper, you’re losing money, you just may not owe anything. Let me know! Fingers crossed!
Yeah, I’m not too panicked, I’ll just double check that we are maximizing every possible deduction. As for the self employment tax, since I’m not charging a cleaning fee, I don’t think that’s going to be an issue really. I usually have one of his tax preparers do my actual taxes and he signs off on them. But he’s a good guy and doesn’t mind taking a closer look in July if I treat him to lunch at a local place on the water. He then subtracts that cost from my preparation in March.
If it is taken as a regular rental, like my CPA forces me to do, then you wouldn’t owe that. But ask @cabinhost… to be sure.
I rent my vacation / retirement home. I am there myself way too much to be able to claim a lot of deductions on my taxes. My rental incomes simply offsets the price of maintaining the place. It pretty much pays my mortgage every month, at least, and some months, way more. The majority of hosts in the Catskills are in the same situation. I’m bad at math, but I would dare say no one is making much money at this in my area. The market is too glutted.
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@Gail_Dedrick, Hi, I’m just up the road from you, in the Adirondacks. I live in my home, renting out the spare room and bathroom, so I don’t get much tax deduction either, except for things like sheets, towels, pillows that I replace. But, it is nice having the extra income to help me update my home.
Exactly! And I love the Adirondacks! Send me your listing …
what do you mean “operating a charity and not knowing it”?