Time share rental with no 1099 misc

Forum|Forum|2 years ago
February 23, 2024
1 reply
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I rented out my 7 day time share and have a small profit for the first time. I had a loss last year so did not have to report any income. Rather than reporting the income on Schedule E and having to claim depreciation, can I report this income as "hobby income" since I did not have a profit for 3 or the last 5 years? I did not use it personally for the last 2 years but did for the 2 years before those.

DawnC

Employee

No, it is not hobby income. If you rent for less than 14 days per year, you don't have to claim any of the income. However, to qualify, you must:

Rent part or your entire house for no more than 14 days during the year
Live in the house yourself for more than 14 days during the year, or at least 10% of the time that you rent it to others.

Master's Rule

Depreciation has to be recaptured when you sell the property, whether you took the deductions or not.

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AGuardino28Author

I was not clear enough. I can only use it for 7 days per year so if I rent it out, I have 0 personal days of usage. So it sounds like I have to pay taxes. Is that correct even though I had no income from it in the last 4 years.

mglauner

If you are renting only 7 days of the year (or less), and not staying there yourself, you would report the income. If you receive a 1099-Misc, type '1099-Misc' in the Search area, then 'Jump to 1099-misc' to get to the entry.

If you just receive cash, check, or credit cards, you can report the income as 'Other Reportable Income'. Under Wages & Income, scroll all the way down the topic listing, to 'Miscellaneous Income, 1099-A, 1099-C'.

On the next page, scroll all the way down to 'Other Reportable Income'.

On the next page, under 'Other Taxable Income', you can list 'Time Share Rental' and the Amount.

Here's more info on Timeshares.

@AGuardino28