Schedul E and vacation home.

Forum|Forum|1 year ago
March 5, 2025
10 replies
55 views

Hi-client has a second home . 73 days rental 14 days personal. The 14 days exceeds the 10% threshold

so it becomes a vacation home instead of full rental. I put all the expenses on Schedule E and it allocates

the correct percentage of everything (84%) but I can't seem to get the program to allocate the 16% balance to schedule A for the mortgage interest. It does populate it for the real estate taxes. I have type 3 -vacation short term rental selected and 73 and 14 for the rental/ personal days.

Anyone know what I am doing wrong? I've tried checking the tax court method nothing changes . If I check the owner occupied box it does allocate but gets an error saying this is a vacation home. I've tried using the 1098 and still no luck.

Does it have to be done manually? Thanks in advance.

ProSeries Professional

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rbynaker

Level 13

What happens if you change the personal use to 15 days?

B

billr617Author

Level 4

If I change it to 15 days it works. Shouldn't it work at 14 though since that is greater than 10% of the rental, (7.3 )days? Does the program ignore it if it is 14 days, or am I misunderstanding the 14 day/10% rule? Thanks for the help!

rbynaker

Level 13

It's 280A(d)(1) and 14 days does not "exceed the greater of 14 days or 10%".

The mortgage interest rules in 163(h)(4)(A)(i)(II) incorporate 280A by reference.

You should still get taxes (subject to SALT cap) since taxes are not limited to a qualified residence.

Rick

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