Partial year rental repair expenses

[MarkAU]

Hi,

I began renting out a house mid year, however the repair expenses are being divided up based on the pecentage of time it was rented out and when I still lived there. All repair expenses were incurred after the property was converted to a rental property.

[Carl]

That's because you answered a few questions wrong. So here's the clarity you need.

Business use percentage - ONE HUNDRED PERCENT business use. The program is asking for the percentage of time you used the property for business **AFTER** you converted it to a rental. If you did not live in the house for one single day as your primary residence, 2nd home, vacation home or any other "personal pleasure" type of use, then your business use percentage is 100%. Anything less and all your rental expenses are prorated.

- Days of Personal use - This will be ZERO. The program is asking how many days you lived in the house as your primary residence, 2nd home, vacation home or any other "personal pleasure" type of use *AFTER* you converted it to a rental. If that number is "NOT" zero, then all of your rental expenses are prorated.

You need to be certain you get this stuff to absolute perfection. Otherwise, it throws off your depreciation and will really screw you up years down the road when you realize it.