@Carl wrote:
If you are planning to rent your property for more than half the year, and occupy it as your primary residence, 2nd home or vacation home for less than half the year, you'd probably be better off leaving it classified as a rental year-round and just reporting your personal use days.
The personal use days are the actual issue, not the classification so the above-quoted suggestion would be ineffective under the facts presented in this thread. As long as there are personal use days, expenses will be prorated accordingly, and days not rented at fair value will not count towards rental use.
Perhaps what some owners (or even the vast majority of owners) do not realize is that, per Section 280A, a day is not counted as a day of personal use if the owner is engaged in repair and maintenance on a substantially full-time basis on that particular day. That would include time spent traveling to stores to get supplies and other necessary items, cleaning, straightening, etc. In fact, even if the owner's entire family were using the property for personal purposes while the owner was engaged in repair and maintenance during that day, it would still not count as a day of personal use.
@Carl wrote:
What you cite applies to short term rentals.
Actually, it does not simply apply to short-term rentals. Rather, the term "residence", for the purposes of Section 280A, is used to refer to a dwelling unit that is used for personal purposes for a number of days which exceeds the greater of 14 days or 10% of the number of days during the year for which the unit is rented at a fair rental.
As an example, if an owner rents property to one renter for a 300-day period (not exactly "short-term") but also uses the property for personal purposes for 35 days during the same year, the owner has used the property as a "residence", must allocate expenses between rental and personal use, and the remaining 30 vacant days are not considered to be fair rental days (even though the unit may have been "available for rent"). Further, losses will be limited per Section 280A.
