Thursday, March 13, 2008

NEW IRS RULING FOR VACATION HOME 1031’s



  • 24 month holding period
  • for each 12 month period you must have rented vacation home for at least 14 days at fair market rent
  • for each 12 month period owner can only use property for the greater of 14 days or 10% of the days rented.
  • Days that relatives use the unit will count against you… unless they pay fair market rent
  • You are allowed a reasonable number of “maintenance days” to care for the unit (not defined by IRS)

SUGGESTIONS:

· Tighten up record keeping and tax reporting

· Be serious in rental attempts

· Charge family members the going rental rate when they use it

Keep detailed records of dates you used the unit and what you did – and describe maintenance done for “maintenance days”

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