What Tax Deductions Are Available for Airbnb Hosts?
A deductible or allowable expense needs to be:
Ordinary and necessary
Something that has actually been paid
Not considered to be capital in nature
You can refer to IRS Publication 527 "Residential Rental Property" for a more thorough discussion on deductible expenses. Here is a list of common deductible expenses:
Advertising: If you invest in some advertisement for the purpose of renting out your property on Airbnb, you may deduct the amount used.
Cleaning: It’s only natural that you will incur day-to-day cleaning and maintenance expenses in order to keep your place clean for guests. These expenses can include hiring a professional cleaning service, laundry services, buying cleaning supplies such as toilet paper, toilet bowl cleaner, a vacuum and so on.
Utilities: You can deduct utility costs, such as gas, electricity, TV, Internet, trash can collection, etc. To figure out the amount you can deduct for these expenses, use the following formula:
[Amount spent on electricity, cable, etc.] x [Days rented out / Days in a month] = Amount that can be deductible for tax purposes
Property insurance and property tax
Interest on a loan or mortgage taken out to buy or improve your rental property
Furniture: The cost of buying furniture for purposes of Airbnb can be a great tax deduction. Such expenses can include beds, desks, drawers and other household items necessary for your Airbnb rental. There may be special rules that apply to furniture in different places, so please be sure to speak with a competent tax professional.
Repairs: Repair costs are also part of the day-to-day expenses for all landlords, including Airbnb Hosts. You may deduct the amount of payment you made for fixing broken windows, doors, furniture and appliances.
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- How Do You Deduct Property Tax Payments?
- How Do You Deduct Home Office Expenses?
- How Do Income Tax Deductions Work for Tenants?
- Is It Possible to Owe No Tax for a Particular Period?
- What Rental Expenses Can You Deduct as a Landlord?
- What Are Start-Up Expenses for Deduction Purposes?
- What Are Specific Examples of Start-Up Expenses Below $5,000?
- How Do You Deduct Start-Up Expenses Over $5,000?
- What Are Rental Operating Expenses Deductions?
- What Are Specific Examples for Deducting Operating Expenses?