I rent out my condo but I lived there for 121 days in the beginning of 2016. Do I deduct my interest and property in the rental expenses and in the tax deductions?

[ejmurphy2002]

Next year I will rent out the condo for the entire year. Will I be able to deduct the property taxes and mortgage interest from both the rental expenses and my personal tax deductions?

[PaulaM · Accepted solution]

You will be allocating the rental/personal amounts of expenses. Ex: Lived in home for 9 months and rental for 3 months. Allocate 75% of interest as a personal deduction and 25% as a rental deduction.

Enter your property under the Rental Properties and Royalties section.  In the rental property section under your Property Profile, indicate that 2016 was the first year to rent the property and that you converted the home from personal to rental (or vice versa).

On the page, Was This Property Rented for All of 2016?, select 'no' and enter the number of rental/personal days. Continue to enter the rental share of interest, property taxes, insurance, etc. 

Note:  The personal use days means 'did you use it after it was placed in service as a rental (like a vacation home). Enter '0' if you never used the property once it was rented to others.

After entering the rental share of interest/taxes, navigate to the Deductions & Credit section to enter the personal share.