I rented my house to my business for 10 days in 2024. Under the Augusta Rule, I need to disclose the earnings ($12,739) but not be taxed on it. How do I do that?

[jm915998]

I have entered the 1099-MISC within the income area of the software. I then entered my property details in the rental area of the software, but it keeps telling me that I don't need to include income because it was only rented for 10 days. Where can I remove that income from the calculation?

[KrisD15]

The software is doing the calculations and reporting correctly.

Since the rent listed on the 1099-MISC is not taxable, the 1099-MISC would not be entered. 

Am I understanding your question correctly? 

[jm915998]

I need to report the earnings through a 1099-MISC, but I need to remove the earnings from the calculation due to the Augusta Rule. 

[AnnetteB6 · Accepted solution]

Since your property was rented less than 14 days, no entry is required to be reported on Schedule E Rental Income and Expenses.  However, if you enter the income reported on Form 1099-MISC in the normal place where this data would be entered, TurboTax is going to take you through the Schedule E section as well.  

Instead, use the steps below to report the income and report the same amount as a negative adjustment.  Ignore the messaging that says do not enter Form 1099-MISC in this manner to avoid going through Schedule E.

• Go to the Income section of your return
• Scroll to the Less Common Income category
• Click Start or Update beside Miscellaneous Income, 1099-A, 1099-C
• Scroll to the bottom of that section and click Start or Update beside Other reportable income
• Answer Yes
• Enter your description and amount for the income you received
• Enter your description and a negative amount for the income you received

The end result is that no additional income is reported on your return, but there are two income entries shown on Schedule 1 line 8z.

@jm915998 

[jennamcf1]

Hi @AnnetteB6 , i'm in a similar situation as the original poster. Received a 1099-MISC for renting my home to a company for 14 days. 

If I understand your response correctly, I should:
1. NOT add the 1099-MISC in Turbotax
2. Add the rental income and the same amount as a negative in the Other reportable income section. 

Is that right? If so -- there are a lot of options in Other reportable income and I'm a little confused about where/how to add the amount and negative amount. I also didn't see anywhere to add a description (or know what description to enter). Does this screenshot look correct to you? Thanks!

[AnnetteB6]

You are correct, do not enter the Form 1099-MISC as its own entry.

From the screenshot you shared, it looks like you clicked that you have 'income from renting out personal property'.  That is not quite the right section.  

Delete those entries and click Continue.  Then scroll to the bottom of the list until you see Other Reportable Income.  Click Start, then answer 'yes', and the next screen will give you the description field along with the boxes to fill in the amounts.

@jennamcf1