I rented our vacation home(time share with disney vacation club) for 7 days, but recieved a 1099misc from the rental company. Do I have to report or not?

[cowleylarsons]

I received a 1099misc form DVC Rental agency for a rental of our time share (vacation club points in Disney vacation club).  It was rented for 7 days.  Do I still report this?  I have read that it has to be more than 14 days. I have entered it in as a rental and there will be a profit of around 8,000$ because the program directed me to when I entered the form. I have always entered all tax forms in the past, but now wonder if I was supposed to or not. If I do have to enter it in, does it go to rental of real estate or rental of a personal asset.  It works to my advantage of it is real estate, but I don't want issues later.  We received a form last year as well and I reported it, but it came out to a loss because it wasn't as much and even less days.

[KittyM]

Yes, there is a 14-day exception to the rental rule if you also use a dwelling unit as a residence and rent it for fewer than 15 days.  You are directed not to report any rental income or expenses if this is the case.  Since you received a 1099-MISC, you may want to enter it and then subtract it on your return, just to keep the IRS' matching program from sending you a CP2000.  (Instructions are below.)  

From the IRS tax topic 415 (available here:  https://www.irs.gov/taxtopics/tc415 ) 

"You're considered to use a dwelling unit as a residence if you use it for personal purposes during the tax year for more than the greater of:

1. 14 days, or
2. 10% of the total days you rent it to others at a fair rental price.

"If you use the dwelling unit for both rental and personal purposes, you generally must divide your total expenses between the rental use and the personal use based on the number of days used for each purpose.  You won't be able to deduct your rental expense in excess of the gross rental income." [emphasis added]

Here's how to enter the 1099-MISC and remove it from taxation, if that option applies in your case:

You will have to report the amount on this 1099-MISC as income, because it's being reported to the IRS. (It will appear on your Form 1040, Line 21 Other Income.) 

To report the income:

• In your open Federal return, choose the tab for Wages & Income
• Scroll down to Other Common Income and Show more
• Start/Revisit Form 1099-MISC
• Type in the reason for your 1099-MISC (Disney Vacation Club)
• Indicate the reason for your payment on the next page (none of these apply) 
• On the following page indicate that it does not involve work like your main job and Continue
• Indicate the year received and Continue
• That it did not involve an intent to make money and Continue
• And is not a recurring payment    
• The income will be reported on line 21 of your return. 

To enter the expense:

• Scroll down to  Less Common Income and Show more
• Start/Revisit Miscellaneous Income and choose Other reportable income 
• Say Yes to continue to the screen "Other Taxable Income". Enter the description as "14-day Rental Exception"  and the amount as a negative number. 

A corresponding negative amount will be entered, and line 21 will be zero.