Schedule E expenses for end of year purchase

[Eric Lowder]

Quick question about 2023 expenses.

We purhchased our first inventment property at the end of December 2023, but did not get it listed for rent until January.

We had some expenses associated the purchase in 2023 that would normally be captured on a Schedule E for 2023, but I don't think we can do a Schedule E since the property was not listed for rent in 2023.  

In this case, how and when can we incorporate those expenses into our taxes?  Would those 2023 expenses be captured later on a Schedule E on our 2024 taxes?

[Sean O'Keefe]

 @Eric Lowder since you didn't place the "property in service" (e.g. make it ready and available to rent) until Jan 2024 you'll report the income and expenses on Schedule E in the 2024 tax year.

In rare cases, that short-term rental income will be reported on Schedule C, but this is only if the rental offers "substantial service" that includes things like concierge services or a butler. 

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