STR 01: How The Short-Term Rental Loophole Can Save You Thousands in Taxes

Why are short-term rentals important in your real estate business? If done properly, short-term rentals can help you take real-estate losses without being qualified as a real estate professional. Learn how you can save thousands in taxes with short-term rentals in this podcast.
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[@MrShutterButter]

Q: how long do you need to put a property in STR to qualify its income as active income? Follow up Q: If you make your primary residence as STR in December, and maintain an average of

[@tactikal9742]

yes. you will want to actually rent it out at least onece but more is better if you get audited.

[@tactikal9742]

your podcast (sound) game is on piont, but you might want to up date your camera and background and color correction (lutz) if you want to up your KZbin game. In your own time that is no rush. I am smart enugh to value the info over everything, but some people are visual and need quality imagery to be stimulated. thank you for all that you do. I am a client. I work with Gaberial.

[@TheRealEstateCPA]

Thanks for the heads up. That will be coming soon!

[@uzoamakaeke8384]

Will the non passive losses of STR be under schedule E or schedule C? Does it have to be on schedule C for those losses to be used towards my W2 income?

[@lorad31]

It sounds like it would be on sch C for it to be deductible

[@tax-modern]

The STR income/losses still will generally go on Schedule E (it's only Sch C if you provide "substantial services", which is rare, that means services to guests during their stay, not just doing turn-over between guests). The loss doesn't have to be on Sch C to offset your W-2 income, that's still possible with Sch E losses. But the amounts are entered a little differently. Actually, I have a video on my channel on exactly this subject because there isn't much info out there on how the STR loophole actually appears on the tax forms!

[@pamelasheridan2178]

Can you be REPS and benefit from STR (business) deduction?

[@wonderornot]

Have a STR, filling married and w2 income above $150k combined. Average 7 days or less stays for guests and pass one of the 7 tests. I keep reading that $150k+ income doesn't qualify. Is that accurate?

[@jfsbtx]

Will definitely be following STR owner from Texas

[@curatedwithloveevents]

If you make 150K a year and own 45k in taxes but then apply a bonus depreciation of 200k does that mean you get a 45k check or a 155k check or?

[@Cuencanation]

I'm the owner of a property management company and hire employees to manage properties which happen to be mine. They are a mix of long-term and short-term units. I do however have a fulltime job in addition to this. Any specific resource for individuals in similar scenarios as me?

[@TheRealEstateCPA]

Have you read our REPS guide? If not, check it out: www.therealestatecpa.com/guide-to-qualifying-as-a-real-estate-professional

[@FlyFishingRealtor]

I want to buy a home in FL and long term rent it to my family in the winter and Airbnb in summer. I’m buying it as a second home and plan to eventually stay there in winter. Would this be a investment to depreciate or the other mentioned here?

[@TheRealEstateCPA]

Could be, but you have to watch out for the rules around personally using a vacation home. If your personal use exceeds 14 days OR 10% of the total rental days, your losses related to the rental will be limited.

[@pp-8829]

Great pod. Can I run an STR and qualify for active losses and use that to depreciate another property that doesn't run as an STR?

[@moisesdiaz6392]

Great video! I own 2 short rentals! Are you a CPA?

[@TheRealEstateCPA]

I am!

[@moisesdiaz6392]

I’m looking for a great CPA experienced working with Short term rental clients. How can I get a hold of you?

[@davidjenkins7062]

If I rent out my Florida property for 90 days to one renter, then the balance of the year is to 7-days or less renters, so that the average length of stay is say, 6.8 days for the entire year, does that meet the overall 7 day STR rules set by the IRS ?

[@TheRealEstateCPA]

If your average period of customer use is 6.8 days yes for the year, yes.

[@petecromwell9047]

Can I "actively participate" by managing my property management company? I bought a property, rent it out mostly through a property management company but occasionally rent it a little on my own too.

[@TheRealEstateCPA]

Active participation for the special loss allowance, yes. However, for the purposes of the STR Loophole, the IRS generally views the use of PMs as you're NOT materially participating.

[@zdog1566]

Would this apply if you rent out a room in your house?

[@MakuLabs]

Mind blown!

[@DewTime]

You guys are geniuses.

[@TheRealEstateCPA]

Appreciate it!

[@SgtSam1]

Recently found your content including your podcast. Unfortunately I cannot play any of your podcast episodes on Apple podcast. Gives me an error every time. All my other podcast work fine

[@TheRealEstateCPA]

I'm not exactly sure why that is. We are in the process of posting all of the podcast on the KZbin channel if you are interested.

[@SgtSam1]

@@TheRealEstateCPA definitely consuming the content here. As a delivery driver, podcast are best though so hopefully you can get that back up and running soon. Thx!

[@TheRealEstateCPA]

​@@SgtSam1 It appears to work on this end - looking into it to see if its a more widespread issue. Its also available on Google Podcasts, Spotify, Stitcher, and pretty much every other podcast platform too.

[@SgtSam1]

@@TheRealEstateCPA Still the only podcast not working for me on Apple. I’ll check it out on those other platforms. Thanks!