Short Term Rental Loophole

[Matthew Kauk]

Looking to use the short term rental loophole.

If I use the short term rental loophole for my STR, I material participate and do a cost seg study.

Can I take the value of the building in the first year as depreciation and write it off against my wife's income? ( Not sure if that's the correct terminology.)

Whatever loss I take in the first year against my wife's income, does doing this change my rental income from being passive to non passive income as well?

And would this mean that my short term rental income becomes ordinary income?

Thanks for the help in advance.

[Wen Chieh Chang]

Hi @Sean O'Keefe,

I am an out-of-state investor. Can a long-distance investor be considered materially participating in their STR property? Also, how to prove

"Spend more than 100 hours on the activity and no one other individual spends more time than you do"? 

Should I keep a record of what I did and how many hours I spent on the activity every day (and also other)?