Question

Business rental on Sched E worksheet

Forum|Forum|2 years ago
March 31, 2024
1 reply
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I have an aircraft hangar that is a Property Type 4. I rent out space to other people but also have my own property stored there and use around 25% of the space all year long. How do I account for that? The sched E worksheet seems to only be for living units, not commercial or storage. I have tried the following three methods and each one gives vastly different results.

There is the field that MUST be filled out for all rental properties for rental and personal use days. I rented it for 365 days so I put 0 days personal. I also tried 275 days rental and 90 personal to account for my "25% share".

There is the Owner Occupied Rentals % of rental/personal use. But that is only for a home/living unit. I tried putting in 75% rental.

There is also the Vacation Home with personal days, but it is not a vacation home.

The simplest may be to just pay rent equal to 25% of the total that is included in the income line. Would the IRS say I am not paying enough if I have losses?

Not sure what to do.

A

AnnetteB6

Try entering it as a commercial property but depreciate only 75% of the cost of the property. Also, prorate the other expenses to account for your 25% personal use.

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