AirBNB Rental Income with Land Contract Home

[Cmo3]

I've searched and searched until I've gone crosseyed, and cannot seem to get a clear answer on this.

I currently run a full-time AirBNB on a home that I do not technically own. The home is under a land contract/land purchase agreement/lease to buy contract, so there is no actual mortgage, no actual mortgage interest, etc.

What expenses can I deduct, and how should I deduct them. I don't believe that I can use the Schedule E and depreciate the home that way. Can I claim the entire monthly payment, as it is ordinary and necessary for me to conduct my AirBNB business?

I am having issues finding the answer this particular situation.

[Anonymous_]

You need to check the laws in the state in which the property is located. In some states, title actually passes when a land contract is executed.

If that is the case, you would report on Schedule E.

[Cmo3]

The title remains in the name of the owner/seller until the end of the listed time frame. Property taxes are still in their name as well.

[Anonymous_]

Do you provide services to your renters (e.g., meals, daily maid services, et al)? 

If not then report on Schedule E.

[Cmo3]

Yes I do. It is one of my primary sources of income, which I spend a majority of my time on. I manage it, and other properties, full-time.

[Anonymous_]

If that is the case (providing significant services to renters) then you should report on Schedule C.

[Cmo3]

I have TurboTax Home & Business; what sections would be the best to list the lease/land contract payments?

I started down the Schedule E route, but after reading, I thought I would ask for advice here (THANK YOU!), so I will delete that portion of the return.

[Anonymous_]

Rent or lease (Line 20) or, alternatively, you could use Other expenses (Line 27).

[Cmo3]

Great! Thank you for all of your help!