- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
Last year, rental property put up for sale and/or rent (which ever came first). The rental property was rented for the first 6 months, vacant the next 3 months, and then rented for the remainder of the year.
Someone asked a similar question and someone replied to their question as it being okay to deduct all expenses since they did not sell...
However, I came across the following on this link: http://www.irs.gov/pub/irs-pdf/p527.pdf
Vacant rental property. If you hold property for rental purposes, you may be able to deduct your ordinary and necessary expenses (including depreciation) for managing, conserving, or maintaining the property while the property is vacant. However, you cannot deduct any loss of rental income for the period the property is vacant.
Vacant while listed for sale. If you sell property you held for rental purposes, you can deduct the ordinary and necessary expenses for managing, conserving, or maintaining the property until it is sold. If the property is not held out and available for rent while listed for sale, the expenses are not deductible rental expenses."
So, I'm assuming since I had the rental property available for rent while listed for sale, I cannot deduct any of the expenses I normally deduct while it's rented?
Accepted Solutions
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
Grey area - you say the house was "put up for sale and/or rent (which ever came first)". Was the Primary intent to rent or to sell it? Matter of judgment - if primary intent was sale, then technically your conclusion is correct - "cannot deduct any of the expenses I normally deduct while it's rented".
You could also take the position there was no Primary intent either way, and as such, since it was available for rent, I would deduct all of the expenses for the whole year as being attributable to rental activity.
I hope this helps you make a decision.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
Grey area - you say the house was "put up for sale and/or rent (which ever came first)". Was the Primary intent to rent or to sell it? Matter of judgment - if primary intent was sale, then technically your conclusion is correct - "cannot deduct any of the expenses I normally deduct while it's rented".
You could also take the position there was no Primary intent either way, and as such, since it was available for rent, I would deduct all of the expenses for the whole year as being attributable to rental activity.
I hope this helps you make a decision.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Rental expenses while vacant and listed for sale and/or rent (which ever came first) and then rented...
As far as "loss of income due to vacancy," this is simply stating if the property sits unrented for say 3 months, and you normally rent it for $1000/month, you can't take a $3000 deduction for the rent you didn't get.
Still have questions?
Make a post