jakerjc
New Member

Are there parameters regarding the number of years that a vacation home must be rented to qualify as reporting it as a rental property sale when sold?

 

Investors & landlords

No.

Just be aware that if the property was sold at a loss, there may be restrictions on claiming the loss.  If it was sold at loss, was it converted to 100% rental, or did it go back-and-forth between personal-use and rental use?

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jakerjc
New Member

Investors & landlords

Okay Bill thanks for your help.  Based on your answer, I feel that I can treat the sale of my property as a rental sale for 2017.  I had converted my home which we had used as a vacation home from May 2004 thru November 2014  to  a 100% rental in December 2014 and it remained a 100% rental until I sold it in May 2017 at a loss.  The couple who we sold  it to is using it as their personal residence.  Do you agree that based on this info, I can treat the loss on the sale of the house in May 2017 as a loss from the sale of rental property?  Please confirm, and thanks again for your help.

Investors & landlords

When calculating a loss, you need to modify the calculations.  If it was converted to a rental in December 2014, you use the LOWER of (1) the Basis at that time (usually the purchase price plus cost of improvements) and (2) the Fair Market Value as the starting Basis.  Then you adjust that Basis for things like (1) improvements after the rental conversion and (2) depreciation.  That is the number you would need to determine if there is a loss or not