Vacation Home Rental Loss Limitation -

[RaifH · Accepted solution]

Owning a rental property is considered a passive activity and subject to most of those rules (except for the ability to deduct $25,000 of losses from your other income if you actively participate.) However, renting a dwelling unit that you use as a home is not considered a passive activity and therefore not subject to those restrictions. 

It is subject to other restrictions, namely, that you can only deduct the portion of your expenses directly related to the rental and some of your operating expenses and depreciation may be carried over to subsequent years rather than deducted in full. 

@ragaei

[cmg1]

I have three properties with similar issues. It appears as TTAX codes it as NPA because I (maybe you) had this situation.

• Rental income from a personal residence may be active if the home is occupied as a personal residence for more than 14 days or 10% of the days the home is rented out.

This does say personal residence, but TTAX seems tonot ask or care, it just assumes if you exceed 10% or 14 days, it is NPA.

[cmg1]

One of my properties is a duplex. it has never been a problem when I rented out both halves TTax wise until I let my son live rent free in one unit and the other unit was rented for 120 days and vacant the rest of the year. Do I check 50% rental use as one half of the duplex is 50%. How do I fill out the days rentaed and days personal use  numbers? It is like I have two properties on one Sched E.