david3
Level 8
‎03-03-2024 06:06 PM

Preparing a 1065 for a residential rental property that was vacant from September - December for remodel and repairs.

Per Pub. 527, a TP can't deduct a loss during the vacancy period. Where in PS do I limit the loss?

The rental days reported is 247 and the personal use days reported is zero. My understanding is that the remodel and repairs time period isn't considered personal use days.

How does PS handle the loss limitation for this situation?

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TaxGuyBill
Level 15
‎03-03-2024 07:06 PM

Why do you think the deductions can't be used or that they can't create a loss?

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abctax55
Level 15
‎03-03-2024 08:10 PM

Vacant vs "not available' - two different things with different tax treatments. 

Which one applies to your client?

HumanKind... Be Both
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david3
Level 8
‎03-04-2024 12:51 AM

Previous tenants trashed the house and left in September. The owners did repairs and remodel through December. 

So, I guess it was unavailable during that time. 

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Just-Lisa-Now-
Level 15
Level 15
‎03-04-2024 06:56 AM

It was still a rental property the whole time, they didnt ever take it out of service as a rental.  


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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david3
Level 8
‎03-04-2024 12:03 PM

I thought the property had to be advertised for rent and since repairs/remodeling were being done, the property wasn't advertised or available for rent. Therefore, according to Pub. 527, the losses couldn't be deducted for the time period it wasn't available.

I guess it's how "not available" is defined. 

Thanks for your help.

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