Vacation Home Tax Deductions are somewhat complicated and involved. The best plan is to stay current on your documentation & record keeping as to how and when you use the vacation home.

1. If you do not rent out the vacation home for more than 14 days throughout the year, you may deduct the mortgage interest & the real estate taxes on the Schedule A of IRS Form 1040.

2. If you use the vacation home for less than 15 days of the year and you rent the property for more than 14 days of the year (10% of the total amount of the rental period-whichever is greater); the property is treat as a “Rental Property”. Your expenses associated with your Rental Property are deducted on
Schedule E.

3. If you rent your home for part of the year and you use the home yourself for more than 14 days or 10% of the amount of the days you have rented it you will need to keep documentation and allocate the percentage of how often the home was rented vs. your personal usage. Items to keep track of-income & expenses