STR tax implications and mitigating tax impact

[Bryce Bender]

Hi all,

I have been using my basement as an STR house hack for about 2 months, currently I'm only listing on AirBnB. It's done much better than I predicted (due to the summer months probably) and I want to ensure I have all my ducks in a row for next year's taxes so I don't get blindsided.

As a live in STR (where I rent out a portion of my home) would making an LLC help in mitigating tax impact? I've kept a detailed record of start-up expenses for write offs, but will the AirBnB income be taxed at the end of the year based off of my income tax bracket? (Most of my income is W2 income, about 33% above the local median).

Please share your STR tax mitigation stategies, to make this a viable investment strategy. The more details you can share, the better!

[Luke Carl]

@Bryce Bender you’ll need to talk to a professional about this (CPA) since you’re asking for legal advice. 

My OPINION LLC is worthless in your case unless the property is not leveraged. But even then the LLC won't be for tax purposes but for CYA purposes.

You do have to pay State Sales and City/County lodging tax every month or you’re breaking the law. (Mylodgetax.com) 

Find yourself a good CPA that OWNS vacation rentals and understands them. But honestly in your case turbo tax should do the job. 

Buy all of your supplies on amazon so your write offs are all in one place. 

And last but not least.... Read a book called Loopholes of Real Estate. ASAP. 

And hit the vote button ;)