Remote STR Cost Seg + Bonus depreciation for W2 tax offset

Tax, SDIRAs & Cost Segregation
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Remote STR Cost Seg + Bonus depreciation for W2 tax offset

Pratap Singh
NC · Member since 2020 · 24 posts · 7 votes

Can remote STR help us to qualify STR tax benefit. STR in Florida and owner lives in VA. Managing remotely from VA after initial 2 weeks of onsite hours in furnishing property (~80 hrs) after closing in june.

And 20+ hours in remote remote co-ordinating bookings, cleaning by cleaner, answering guest etc. Except cleaner no other help as its new construction so no maintenance expected.

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Michael PlaksPro Member
Tax Accountant / Enrolled Agent · Houston, TX · Member since 2014 · 5k+ posts · 6k+ votes
4y

Potentially yes, although it requires a careful examination. You seem to clear the 100 hours threshold, providing the hours are of countable hands-on participation and are documented well. If your hours exceed those of your cleaners, you may be able to pass. Again, this cannot be conclusively determined here on the forum.

Also, keep in mind that cost seg/ bonus depreciation will only create a benefit in the first year. After that, this property will not have significant depreciation.

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  • Michael PlaksPro Member
    Tax Accountant / Enrolled Agent · Houston, TX · Member since 2014 · 5k+ posts · 6k+ votes
    4y

    Potentially yes, although it requires a careful examination. You seem to clear the 100 hours threshold, providing the hours are of countable hands-on participation and are documented well. If your hours exceed those of your cleaners, you may be able to pass. Again, this cannot be conclusively determined here on the forum.

    Also, keep in mind that cost seg/ bonus depreciation will only create a benefit in the first year. After that, this property will not have significant depreciation.

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  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    4y

    If planned correctly, yes. But have to do careful planning and documentation. 

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  • Basit SiddiqiBusiness Member
    Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
    4y

    Follow the requirements - Yes
    Don't follow the requirements - No

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