Tax Facts About Renting Out Residential Property

 

For individuals who rent out their residential property for income, there are different tax rules that apply based on whether they used the property as a residence at any time over the course of the year.

 

Residential rental property may include a single house, condominium, apartment, mobile home, vacation home, or similar property. These properties are often referred to as dwellings. Taxpayers renting the property can use more than one dwelling as a residence during the year. Using a dwelling for personal purposes for more than the greater of 14 days or 10 percent of the total days rented to others at a fair rental value is considered a residence. Personal use includes:

 

  • Any person who owns an interest in the property or a family member of such person

 

  • Anyone who has an arrangement that lets the owner use some other dwelling

 

  • Anyone using the property at less than fair rental value

 

Personal use does not include days for repair and maintenance if the work is being done on a largely full-time basis.

 

* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.

 

Tip adapted from IRS.gov[i]

[i] https://www.irs.gov/newsroom/know-the-tax-facts-about-renting-out-residential-property

 

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