You’re obviously familiar with the ins and outs of the unique insurance requirements when it comes to vacation rental homes.
But did you know that when your clients offer their home as a short-term rental through services such as Airbnb, VRBO and others, they can keep their income taxes to a minimum – and sometimes eliminate them entirely?
Here are some tips you can share with your clients to ensure they cash in on the profits they’re looking for:
- Learn about the 14-day vacation rental tax rule.
- Keep flawless records of rental periods.
- Document all business expenses.
- Fill out Form W-9 Taxpayer Identification Number.
- Deduct the guest-service or host-service fees.
- Learn about applicable occupancy taxes.
- Pay self-employment taxes.
- Read IRS Form 527, Residential Rental Property (including Rental of Vacation Homes).
- Seek the advice of a tax professional
Click here to download the complete Vacation Rental Business Success Guide: The 3 Cs to Help You Help Your Clients
Of course, encouraging your client to seek the advice of a tax professional is the best advice, but you can provide them with this list as a good start. Doing so will show your clients that you want to be more than their insurance agent; you want to be an advocate for their success.
The first and second parts of this three-part blog series addressed two other critical issues of vacation rental business success – compliance and insurance coverage. In case you missed them, click here for compliance and here for insurance coverage.