AirBnB Rental in 1/2 of property. Do I understand the deductions?

3 Replies

Hello,

here's my situation: I live in a house and rent rooms on AirBnB. What can I deduct?

1) I live in 1/2 of the house (sqft). However it is only 1 bedroom: I rent 3 bedrooms on AirBnB. My research told me to split common bills on tax return either per sqft or per bedroom. Do I get to chose? (If yes, the bedroom split is much more in my favor). Bills I can think of in this category: Mortgage Interest, Insurance, Utilities, ...

2) I have consumable expenses (Shampoo, Towels, Sheets, ...). I believe I can deduct these, or am I mistaken?

3) What about other expenses such as furnitures, electronics, wall insulation, plumbing in the rented space? Does it fall into the 100% deductible (as in not divided per sqft/bedroom), amortized over X years category?

4) What about expenses such as retro-fitting the place to get it airbnb-ready (I had to add doors, buy keypad locks, smart thermostats, ...)

5) I do a lot of the work myself. Instead of having a contractor bill, I have receipts from the hardware store. Are tools & parts deductible?

6) Are there common deductions I am forgetting about? Not trying to be greedy, just getting a quick understanding of commonly deducted expenses that are often overseen.

Thinking of maybe: cell phone bill, home office space, gas used (this one is a stretch since I live on the property). 

Thank you!

@Michael Hayes I do the exact same thing. I'm personally no expert to taxes but I talked with a CPA and they said you can deduct everything you put into your house if you're running an Airbnb out of it. There is actually an Airbnb CPA on Biggerpockets. I'll try to find his name and give it to you. 

@Myka Artis , thank you! 

If I understand you correctly, you mean that even expenses on my side of the house can be deductible from my taxes?

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