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Tag Archives: Rental Property

Vacation Home Rentals: How the Income Is Taxed

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on May 3, 2022 by Lake Wylie Tax Services StaffMay 3, 2022

Vacation Home Rentals How is the Income TaxedIf you have a second home in a resort area, or if you have been considering acquiring a second home or vacation home, and with summer just around the corner, you may have questions about how rental income is taxed for a part-time vacation-home rental. The applicable rental rules include some interesting twists that you should know about before you begin renting. Although some individuals prefer to never rent out their homes, others find such rentals to be a helpful way of covering the cost of the home. For a home that is rented out part time, one of three rules must be considered, based on the length of the rental:

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Posted in Tax Central | Tagged Rental Property

Tax Issues Related to Renting Your Vacation Home

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on June 9, 2021 by Lake Wylie Tax Services StaffJune 9, 2021

tax issues with home rentalDo you own a second home at the beach, in the mountains, or some other getaway location, or are you thinking about buying one? If so, then you may have thought about the possibility of renting it out. Though many people would never consider inviting renters into their vacation home, preferring to keep it for themselves and their family, doing so can offset some of the expenses related to the property, and you may even reap a tax benefit at the same time. Whichever route you choose to go, knowing all of the applicable tax rules regarding designated second homes helps you get the maximum financial benefit out of your asset and keeps you from making tax filing errors.

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Posted in Tax Central | Tagged Rental Property

Tax Issues That Arise When Converting a Home into a Rental

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on September 9, 2019 by Lake Wylie Tax Services StaffJanuary 23, 2020

tax issues with home rentalThere are many reasons to convert a home into a rental, such as to ensure that a prior home produces income and appreciation after the owner buys a new home; to maximize the tax benefits for an elderly person who can no longer live alone by delaying the sale of that person’s home; and to ensure that a home provides value when its owner takes a temporary job assignment in a different location. Some homeowners even mistakenly think that, when a home has declined in value, converting it into a rental can allow them to deduct that loss. Regardless of why an individual makes such a conversion, a number of tax issues come into play as a result of that decision.

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Posted in Tax Central | Tagged Home and Mortgage, Rental Property

Important – Rental Owners! Guidance Related to the 20% Pass-Through Deduction

Lake Wylie Tax Service | Bookkeeping | Payroll Service Posted on January 24, 2019 by Lake Wylie Tax Services StaffJanuary 23, 2020

beach front rentalsEver since tax reform was passed, over a year ago, taxpayers have been uncertain whether rental property will be classified as a trade or business for purposes of qualifying for the new IRC Sec 199A 20% pass-through deduction (commonly referred to as the 199A deduction).

Finally, on January 18, 2019, the IRS issued a notice which provided “safe harbor” conditions under which a rental real estate activity will be treated as a trade or business for purposes of the 199A deduction.

It’s important to note that this notice prescribes several conditions that must be met for a rental real estate enterprise (a tax term introduced by the IRS in this notice) to be deemed to be a trade or business and eligible for the section 199A 20% deduction. For purposes of this safe harbor, a rental real estate enterprise is defined as an interest in real property held for the production of rents and may consist of an interest in multiple properties.

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Posted in Tax Central | Tagged Rental Property, Tax Reform
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