The holidays are a great time to get away to a vacation home. Escape the crowds of the summer and have a truly relaxing holiday getaway. If you own a vacation home, you probably know that you need to report rental income, but here are 7 tax tips Forbes published that you won’t want to miss.

  1. The Definition of a Vacation Home — First, realize that a vacation home can be an apartment, condo, mobile home, boat or other type of property. A vacation home isn’t limited to single-family houses.
  2. How to Report Rental Income — Most rental income is reported on Schedule E, but it may also be subject to Net Investment Income Tax.
  3. Personal Use — If you use your vacation home personally as well as rent it to others, you’re required to divide your expenses between the rental use and the personal use.
  4. Definition of Personal Use — Personal use is defined as use by either you or your family, or any other owner and his or her family, as well as use by anyone paying less than a “fair” rental price (such as friends who receive a steep discount).
  5. Exclusive Use as a Vacation Home — If you live in the home on any regular basis, your rental expense deduction is limited. Your deduction for rental expenses can’t be more than the rent you received.
  6. When to Use Schedule A — You can report deductible expenses for personal use on Schedule A, Itemized Deductions: mortgage interest, property taxes and casualty losses.
  7. When You Don’t Have to Report Income — If you rented your vacation home less than 15 days during the year, and you live in the home on a regular basis, you don’t need to report the rental income.

If you have other questions about renting residential or vacation property, take a look at this IRS resource, or feel free to give me a call and we’ll schedule a time to talk.

And if you’re headed out to your vacation home for the holidays, enjoy your time there!