Tax home & Renting out my house

  1. I am looking to start traveling. I would like to rent out my house as a short term rental unit on Airbnb or to other travelers. I understand that if I rent out my house, I am giving up my tax home, since I am not duplicating expenses. Would it be allowable to put it on Airbnb as a space share, but say we will never be there? It is a 3 bedroom 2 bath house so we could just reserve the smallest room for ourselves. If I do indeed rent out the entire house, what would be the best option to maintain the tax home? Should we rent a room from our relative that also lives in this city? I am looking to do things legit as I do not want any problems with Uncle Sam. I appreciate any advice! Thanks!
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  2. 4 Comments

  3. by   NedRN
    House share on AirBnB is legit. So would be taking on a full time housemate. If AirBnB, you will have to have a local manager to watch the place, perhaps giving them keys so you don't get a scammer, and someone to clean up. I'd take the full time housemate if it were me. Just have to vet one person, and a great deal for both of you. Perhaps just as much revenue as the much more risky absent AirBnB landlord.

    There is some kind of one time exemption if you rent entire place, perhaps meant for house swaps. I seem to recall max period is 7 months but that may be way off. More info should be on the TravelTax site, or try Google.

    I think that renting a room in your historical residence area should cover you too. Get a free consult with TravelTax as it may have to be done correctly. I know one thing he will say is that you will have to pay market price. I don't agree completely, no problem if you find something below market. An issue at an IRS audit though will be if it is an arm's length transaction - not from a friend or family member.
  4. by   jive turkey
    Quote from Nurse Kyles
    I am looking to start traveling. I would like to rent out my house as a short term rental unit on Airbnb or to other travelers. I understand that if I rent out my house, I am giving up my tax home, since I am not duplicating expenses. Would it be allowable to put it on Airbnb as a space share, but say we will never be there? It is a 3 bedroom 2 bath house so we could just reserve the smallest room for ourselves. If I do indeed rent out the entire house, what would be the best option to maintain the tax home? Should we rent a room from our relative that also lives in this city? I am looking to do things legit as I do not want any problems with Uncle Sam. I appreciate any advice! Thanks!
    I will 2nd what Ned said, get a roommate. Keep your address and tax home, have someone more consistent in the place, more consistent income, less hassle and vacancy vs Airbnb. I would NOT advertise that you will never be there, even on a listing for a room mate. You can get robbed like that. Yes, rent your master especially if it has the master bathroom. You will get more rent for it, a more stable tenant who will stay longer for the privacy, and you can claim a bigger tax deduction on the rent income for renting out more square footage.
  5. by   Nurse Kyles
    I guess my idea having an airbnb rental is that my brother in law lives nearby and I have a friend who does professional cleaning who would be able to manage the airbnb rental. Obviously just renting it out to a roommate would be a lot less hassle though. It is sad to say, but we have so many possessions that I wanted to just store in my basement and lock off, which is totally the lazy thing to do. I might just have to bite the bullet and sort through all my stuff as my laundry is in the basement, and a long term renter would certainly need access to the washer and dryer. It definitely is a lot to think about. Thanks for the advice. I really appreciate it.
  6. by   NedRN
    Well you are certainly set up for AirBnB then, although your washer dryer is a plus that can sway those cruising AirBnB. I might suggest some easy market research before going the AirBnB way. Log in as looking, and see how many places are near to you, and how many are booked well ahead of time. Lots of places fully booked suggests AirBnB may be better than a housemate

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