How much can I claim for meal expenses for a family of 4 (2 adults, 2 kids) while at vacation rental property on days where all 4 were doing rental maintenance work?

[coleen-pub]

The vacation rental property is owned by both my husband and I.  It is rented part of the year.  We stayed in the property while we were there as there were no renters.  The kids (ages 16 & 14) fully participated in the rental maintenance on the days we did maintenance work. 

We also had personal days while we were there (7 personal days to 8 maintenance days).  

We mainly bought groceries and fixed our own meals (both for personal and maintenance days).   

Can I claim the standard meal deduction ($51/day) for all 4 of us for the maintenance days?

I know that ultimately I only claim 50% of the meal expenses, but I'm trying to figure out what number I start with.

Thank you.

Coleen

[DianeW · Accepted solution]

Yes, you can use the standard meal allowance or the actual expense, whichever is higher, as you stated for the maintenance days only.

Note:  p 4 of 527:  Travel expenses.

You can deduct the ordinary and necessary expenses of traveling away from home if the primary purpose of the trip is to collect rental income or to manage, conserve, or maintain your rental property. You must properly allocate your expenses between rental and nonrental activities. You cannot deduct the cost of traveling away from home if the primary purpose of the trip is to improve the property. The cost of improvements is recovered by taking depreciation. 

Any expenses directly attributable to the time you are at the location for repairs would be allowed. For more information about vacation rental property you click the link here.  IRS Publication 527

(Edited: 01.08.2018 | 8:23 AM)

[coleen-pub]

So on those maintenance days, can I deduct the meal allowance for only my husband and I or can I deduct a meal allowance for all workers (ie. kids as well)?

[Hal_Al]

None of your meals are deductible.

It's questionable whether any of your mileage is deductible, since there was substantial recreational activity on the trip.

[coleen-pub]

I believe your answer is incorrect.   Publication 527 states: Travel  expenses.  You  can  deduct  the  ordinary and necessary expenses of traveling away from home if the primary purpose of the trip is to collect rental income or to manage, conserve, or maintain your rental property. You must properly allocate your expenses between rental and non-rental activities.   

In addition, Publication 463 (Travel Expenses) states: Trip Primarily for Business - You  can  deduct  all  of  your  travel  expenses  if your  trip  was  entirely  business  related.  If  your trip was primarily for business and, while at your business  destination, you extended your stay for a vacation, made a personal side trip, or had other  personal  activities,  you can deduct only your  business-related  travel  expenses.  These expenses include the travel costs of getting to and from your  business  destination and  any business-related expenses at your destination.

So meals on business days should be deductible as well as mileage to/from the rental (which is out of state from us) as the primary purpose of the trip was to do repairs/maintenance and prepare the rental for renters coming in.   

I'm still trying to figure out the answer to the original question - how many of us can I claim the meal allowance for.

But thanks for trying to answer my question.
Coleen

[macuser_22]

In my opinion, your were living in a home that you owned for 15 days, so even though the home was rented for the rest of the year, it became your personal residence for those 15 days. As such you cannot deduct any personal expenses for working on your personal residence while you lived in it.    Had you lived in a hotel then I agree with the publication that you quoted.   I can't quote any tax court references for this - just my personal opinion.

[coleen-pub]

Fortunately vacation rental property use is pretty well spelled out both in publication 527, Chapter 5 & here: <a rel="nofollow" target="_blank" href="https://www.irs.gov/taxtopics/tc415">https://www.irs.gov/taxtopics/tc415</a>   As long as I don't use it for personal use more than 14 days a year (those maintenance days don't count as personal days), my expenses are deductible and distributed between the number of days of personal use and rental use.

[TaxGuyBill]

Although my first thought was that I agreed with Hal_Al, after doing some research I agree with Diane above.  *IF* the 8 days were full-works days (EVERYBODY had minimal personal pleasure during those days), yes, the meal Per Diem should be deductible.  It will be prorated based on the ratio of rental days versus personal days.

As for how many people to deduct, I would deduct it for all four of you (assuming it was full work days for everybody with minimal personal pleasure).

However, a word of caution:  If those maintenance days were not full work days (had significant pleasure) for ANY of you, that MIGHT disallow the deduction for ALL of you.  It could turn them all into personal use days.

[DianeW]

@TaxGuyBill thank you for the additional detail.

[coleen-pub]

I'm mostly in agreement with TaxGuyBill (and in my situation I'm covered since we all were working substantially full time on our work days).  However, not everyone has to be fully working to count it as a maintenance day (vs a personal day).  Here is a scenario straight from publication 527 page 18:   

Days used for repairs and maintenance.
Any day that you spend working substantially full time repairing and maintaining (not improving) your property is not counted as a day of personal use. Do not count such a day as a day of personal use even if family members use the property for recreational purposes on the same day.

Example. Corey owns a cabin in the mountains that he rents for most of the year. He spends a week at the cabin with family members. Corey works on maintenance of the cabin 3 or 4 hours each day during the week and spends the rest of the time fishing, hiking, and relaxing. Corey's family members, however, work substantially full time on the cabin each day during the week. The main purpose of being at the cabin that week is to do maintenance work. Therefore, the use of the cabin during the week by Corey and his family will not be considered personal use by Corey.

I know they can't spell out every situation, but this one really throws a wrench into things - how many of Corey's family was there?  Is the reason it doesn't count as a personal day is that more people were working than were not working?  Talk about taking something that is complicated and make it even more unclear with this example.

I know I'm good on what days I'm counting as personal days vs maintenance days.  I've decided to only deduct the two property owners meal expenses for the maintenance days rather than all 4 of us to be on the safe side.
Coleen

[KeepingBooks]

What I'm not understanding here is that you have a place to prepare meals, just as you would if you were at home. You essentially are at home. Why should you be able to deduct meals? You have to eat anyway and you have a place to prepare meals. If you were at a hotel- maybe yes. If you're staying in your own house, I'm just not getting it. You have to eat on any work day, regardless if it's your regular job or maintenance on a rental. 

Only if you are more than a certain distance from your primary home, AND you "have" to eat out should you be taking this deduction. That's my interpretation. 

[TomD8]

@KeepingBooks --

You're responding to a thread from 2019.

[KeepingBooks]

I'm well aware of that. 

[macuser_22]

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@KeepingBooks wrote:

I'm well aware of that. 

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Actually this thread could be years older than 2019.   6/1/2019 was the date that the old Answer Exchange was migrated to this new forum and the old posts got the date of the migration not the original posting date .    Many tax laws dealing with deductions have changed over the years and many deductions were eliminated by the "Tax Cuts and Jobs Act".    Refer to current IRS publications for current information.