(Note that IRS Publication 527
, Residential Rental Property (Including Rental of Vacation Homes), lists only the IRS method, reflecting the IRS's continuing position that it is the only permissible method.)
1RS Publication 527
states: "If you provide substantial services that are primarily for your tenant's convenience, such as regular cleaning, changing Unen, or maid service, you report your rental income and expenses on Schedule C." Substantial services do not include the furnishing of heat and light, the cleaning of public areas, the collecting of trash, and such.
Fortunately, according to IRS publication 527, any income and expenses received from a vacation home or rental property with less than 15 days of rent are excluded from tax reporting (both income and expenses).
For specific details on dividing expenses, see IRS Publication 527, but in simplistic terms, the division of expenses is done pro rata to the number of days rented versus not rented (key to note here is days rented versus not rented, as that is a big difference from personal days used versus the rest of the year).
See IRS Publication 527 for details, but for simplicity's sake, we're going to assume MAGI = AGI.
For specific details on dividing expenses, see IRS publication 527; but in simplistic terms, the division of expenses is done pro rata to the number of days rented versus not rented (note well: days RENTED versus NOT rented, as that is a big difference from personal days used versus the rest of the year).
See IRS publication 527 for MAGI details, but for simplicity's sake, we're going to assume (MAGI = AGI).
The IRS position is that the allocation of such expenses is made using the IRC section 280A(e)(l) fair rental percentage (i.e., the number of fair rental days divided by total number of all usage days; see Proposed Treasury Regulations section 1.280A-3[c]; IRS Publication 527, p.
But there is a relevant example in IRS Publication 527 (pp.
However, passive loss limitations and at-risk limitations may need to be applied if they have a net loss (see Chapter 3 of IRS Publication 527
, Residential Rental Property).
The 1998 instructions for Form 4562, Depreciation and Amortization, and Publication 527
, Residential Rental Property, erroneously classified certain personal property used in a rental real estate activity (appliances, carpeting, furniture) as seven-year property.