Short-Term Rental strategies

10 plays in this category. Each one covers the mechanics, who it fits, and the estimated impact — then generates a deep dive against your own numbers.

• Short-Term Rental

  STR Loophole — Material Participation Beats REPS

  Short-Term Rentals (avg stay ≤7 days) are NOT rental activities under §469 — material participation alone unlocks non-passive losses.

  $50K–$300K W-2 tax offset year 1
• Short-Term Rental

  Cost Segregation + Bonus Depreciation on STR

  Cost seg study reclassifies 20–35% of STR building basis to 5/7/15-yr property — 60% bonus (2024) = massive year-1 loss.

  $50K–$150K year-1 deduction per $500K property
• Short-Term Rental

  §280A(g) — Rent Personal Home to Own Business Tax-Free 14 Days/Yr

  The Augusta Rule: rent your primary residence to your own business up to 14 days/yr at market rate — 100% deductible to biz, tax-free to you.

  $10K–$70K/yr in tax-free income + deduction
• Short-Term Rental

  STR §280A(d)(1) — 14 Days / 10% Personal Use Threshold

  Keep personal use under 14 days OR 10% of rental days to preserve STR loss deductibility; over triggers vacation-home rules.

  Preserve $10K–$100K/yr in loss deductibility
• Short-Term Rental

  STR with Substantial Services — Schedule C (SE Tax + QBI)

  STRs providing hotel-like services (daily cleaning, meals, transport) move to Schedule C — SE tax + QBI eligible.

  20% QBI or 15.3% SE savings depending on posture
• Short-Term Rental

  Transient Occupancy Tax — Pass-Through, Not Included in Royalty Base

  Airbnb/VRBO often collect + remit TOT for you — exclude from gross rental income; save on state income tax base.

  10–15% overstatement of gross income prevented
• Short-Term Rental

  STR Arbitrage — Master Lease + Sublet as Furnished Rental

  Lease a unit long-term ($2K/mo), furnish, list as STR for $5K/mo — no property purchase required.

  $2K–$8K/mo profit per unit with $10K–$20K startup
• Short-Term Rental

  Augusta Rule + Cost Seg + STR Loophole Stack

  Combine §280A(g) 14-day rental + STR cost seg + material participation for cascade of tax benefits on same property.

  $75K–$300K/yr combined tax reduction
• Short-Term Rental

  §1031 Exchange from Long-Term Rental into STR

  Exchange appreciated LTR into an STR — defer cap gains, immediately unlock STR loophole + cost seg on new basis.

  Defer $50K–$500K + generate $75K–$200K new-year loss
• Short-Term Rental

  STR with De Minimis Services — Schedule E + Passive Loss Rules Optimized

  Keep services minimal (linens + basic clean between stays) to stay on Schedule E — avoid SE tax while keeping STR loophole.

  $5K–$30K/yr SE tax avoided per property