How can I deduct AirBnB expenses if under 15 days rented

[jdawgb]

I decided to start AirBnB in December of 2025, and so I did not meet the 15 day requirement to file Schedule E for this.  I am reporting this income regardless as Schedule C and will cancel out the expenses.  However, I did put thousands of dollars into my home to upgrade and prepare it for AirBnB.  Is there a way I can still get deductions on these upgrades and expenses (e.g. everything from putting in a fence to purchasing food for the AirBnB, etc), either in my 2025 or eventually 2026 taxes?

[AmyC]

The rule to not use Sch E is that you used your Airbnb more than 14 days or more than 10% of the total days rented for personal use. Fixing a place up is not personal use. If you did not use the unit as a home - a place to relax and live,  you can use Sch E unless your provide substantial services and really are a Sch C filer. A sch C is required when it is more like a hotel, average stay is less than 7 days and you provide regular cleaning, meals, tours, transportation, etc.

Whichever way you go, you will have depreciation on the home and the basis of the home is the lower of fair market value or basis. All those upgrades are usually added to what you paid originally to create your new basis. If filing sch C, you may want to make them start up costs.

The sch C allows a write off up to $5000 for start up costs. The rest is amortized and depreciated over 15 years. 

You can list the food as supplies since they are for the guests.

[AmeliesUncle]

Can you give more information about your situation?

• Was this previously your personal home, then converted to AirBnB use in December?
• Will you be using the home for personal use when it is not rented?
• Do you live there at the same time while people are renting part of the home?
• How many days was it AVAILABLE to be rented in 2025?
• How many days was it ACTUALLY rented in 2025?
• Are "services" provided to the tenants, such as meals, daily maid service or anything beyond just renting space?
• You mentioned food.  Were you providing meals to the tenants, or was it just a few complimentary snacks?

[jdawgb]

Thanks so much for your reply!

This home is my current residence — I rent out the whole space when I am out of town, which is fairly often.

It was available to rent from November 10, 2025 through the end of the year, although only 8 days of that time were rented through AirBnB.

There are not services provided during the stay, however each guest bedroom receives a basket of essentials and I do advertise that the home is stocked with essentials in the kitchen (oil, butter, eggs, etc.).  Of course, professional cleaning is done at the end of each stay.

Thanks again!

[AmeliesUncle]

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@jdawgb wrote:

This home is my current residence — I rent out the whole space when I am out of town, which is fairly often.

although only 8 days of that time were rented through AirBnB.

each guest bedroom receives a basket of essentials and I do advertise that the home is stocked with essentials in the kitchen (oil, butter, eggs, etc.).

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You are renting out your Residence.  It was rented for less than 15 days.  The rental income and expenses go nowhere.  Report nothing.  Well, if AirBnB gave you a 1099, you might want to report it to avoid an IRS notice but then "back it out" result in no profit or loss because it shouldn't even be reported.

Providing those amenities might be a "gray area" which makes Schedule E versus Schedule C questionable, but in my opinion those are NOT "services" and therefore IF and WHEN the rental is reportable, it would go on Schedule E.

[taxmodern]

AmeliesUncle's reply is correct for this situation.  But I wanted correct some info from an earlier reply:

@AmyC wrote:

The rule to not use Sch E is that you used your Airbnb more than 14 days or more than 10% of the total days rented for personal use. Fixing a place up is not personal use. If you did not use the unit as a home - a place to relax and live,  you can use Sch E unless your provide substantial services and really are a Sch C filer. 

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This reply is mixing up a few different things.  The 280A(g) tax code "August Rule" is that you don't need to report rental income at all if the property is your residence and you rent it out 14 days or less during the year.  Then there is a separate 280A personal use test which is if your personal use of a rental property exceeds 14 days and also exceeds 10% of the number of days rented.  But in that case, it still goes on Schedule E, it's just that your expenses can't exceed your rental income, and this is computed by the tax software on Worksheet 5-1 ("Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home"). 

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A sch C is required when it is more like a hotel, average stay is less than 7 days and you provide regular cleaning, meals, tours, transportation, etc.

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That's almost right, except that the 7 days stay is not a factor in determining whether it goes on Schedule C.  The only factor is whether you provide substantial services (cleaning during guest stays, not just between stays, or other services like meals, tours, transportation).  It can go on Schedule C if the average stay is over 7 days, that's not a factor.  The 7 day rule is something completely separate, which determines whether it is passive or non-passive (under 7 days average stay, and also material participation).  But a non-passive rental still goes on Schedule E if you don't provide substantial services (but TurboTax mostly can't handle that situation correctly, unfortunately, without mucking around with forms mode).