[The following conversation with a licensed Texas CPA is for illustrative purposes. It does not constitute legal or tax advice and readers are encouraged to consult with their own professional service providers should they chose to further investigate the opinions expressed here]
It’s tax time, so I recently sat down with CPA and vacation rental owner Stephanie Ball to discuss finance and tax issues that affect vacation rental owners.
What are some of the biggest mistakes that vacation rental owners make when they first get started?
One of the biggest mistakes I see is that people spend too much money; they generate big losses in the beginning. A client of mine was piling up big losses that she wasn’t able to write-off on her tax return and I said, “you need to quit buying more furniture, more towels, more beds, etc. It’s nice enough, just make some money.”
From a tax perspective your goal is to keep the income as rental income and...