Vacation Home/Business Use Disposition Improvement

[Kevin Tudor]

When selling a vacation home reported on schedule E, the basis for gain/loss purposes is using the business use percentage in the year of sale, which is incorrect. This business use is automatically calculated, and is based on number of days rented divided by the sum of personal use days and total days rented.

Please correct this so that the basis for gain/loss purposes is the actual basis, not just the business use in that given year. The business use is utilized for allowable expenses and depreciation, but should not be implemented for the basis calculation on a vacation home. Currently, the workaround is to override a basis adjustment, but this seems unnecessary--the program should do the calculation for us on this.

Thank you.