How does TurboTax handle part of home rental for part of time?

Forum|Forum|4 years ago
March 4, 2022
18 replies
101 views

Let's say if I rented out 1 bedroom (3 bedrooms in total in a single house) for 3 months in last year.

How should I enter those info in TurboTax so that it will handle it correctly?

In the section "Tell us about your situation this year", I selected:

First year rented
Converted home to rental or rental to home
Rented part of the home

Then in a later section "Was test rented every single day in 2021?", I selected "No" and then enter rental days and personal-use days for that single bedroom.

Continue this process, and I didn't see any section to enter info about "footage percentage/ratio of the rental to the whole house". I am wondering if TurboTax actually handles this situation? (The option of "Rented part of the home" in a previous section seems indicated it should this situation)

TurboTax Self Employed Online

AmyC

Level 15

Yes, the program will make calculations for part of the home rented. You did not convert your home to a rental. You simply rented out one bedroom. The program will do the math for you. This is how you should answer when going through the questions, single family, first year rented, I rent out part of my home, not rented all year and so on.

Alternatively, you could list the bedroom and make it a separate entity and do the math calculations yourself.

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ASeeker7Author

Level 2

@AmyC Thanks for the reply.

In the section "Tell us about your situation this year", I tried :

First year rented
Rented part of the home

as well, but I still didn't see any follow-up section I can provide a rental-use ratio.

I am aware of the alternative way which basically do my own math calculation. However, before that, I just wanted to see if TurboTax could handle this situation easily.

ColeenD3

Level 15

No, TurboTax does not handle the situation easily. It is set up for either part of the house or part of the time. Doing both takes some work.

Please see this answer from Marketstar.

Mortgage interest and property taxes are divided between personal (Schedule A, itemized deductions) and rental use (Schedule E) proportional to the number of days used for each and square footage rented

Your formula is as follows: square footage of rental space/ total square footage of house times days rented/365 to be allocated as a rental expense

For instance, if you have $10,000 in mortgage interest and rent 25% of your floor space for 6 months, multiply 10000 x .25 x .5 = $1250 to allocate as a rental expenses. the balance as a Schedule A, itemized deduction.

So, you will enter a portion of mortgage interest and property taxes in both areas.

To enter personal mortgage interest and property ytaxes:

Type in mortgage interest in the search box, top right of your screen
Hit the Enter key
Click jump to mortgage interest in the search results
Follow the prompts and online instructions
To enter rental expenses, type in rental property and follw the above instructions