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Posted by LoTax on October 24, 2006, 7:08 am
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rick wintomac wrote:
> After having CPA and PA give conflicting interpretation, I'm
> not sure but I think this means that:
>
> If my personal use is 20 days, I must rent it at least 200
> days to deduct expenses as a production of income property,
> i.e. deductible loss on schedule E.
>
> Is this a valid example of the second condition (2) above,
> the 10% not having been breeched but being the greater
> number of days?
>
> (The loss of course would be passive loss for me, separate
> issue.)
It's not clear from your post what the conflict of opinion
centered around, so I'll just quote the Code and let you see
if that's gonna clear up the fuzziness. Here's IRC section
280A, in part:
(1) In general
For purposes of this section, a taxpayer uses a dwelling
unit during the taxable year as a residence if he uses
such unit (or portion thereof) for personal purposes for
a number of days which exceeds the greater of -
(A) 14 days, or
(B) 10 percent of the number of days during such year
for which such unit is rented at a fair rental. For
purposes of subparagraph (B), a unit shall not be
treated as rented at a fair rental for any day for
which it is used for personal purposes.
Also, I'm not really up on the "breeching" of percentages,
so I'll stay away from that topic too.
But, on the subject of personal use days, I am experienced.
I wonder if you are acquainted with the definition of
"maintenance days." They are days that you work on your
property - there are rules for how much and how hard and how
effectively you need to work... - which *don't* count as
personal use days in determining whether you've used the
property "as a residence" during the year, which in turn
determines whether your losses from the property may be
limited to zero.
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