Tax - STR - Triplex

[Cody Shepherd]

Hello Investors!

Looking for insight.

I am currently househacking a duplex i purchased in March and remodeled. I live in one side and rent out the other. During the remodel of one of the units I closed off the entrance to the lower level and created the opportunity for a triplex using the back entrance.

I have thought about turning that unit into a STR as I am near the airport.

Another layer... my wife is pregnant and due in January. Next year she can qualify for the tax status of real estate professional when managing the air bnb.

Saying all that, is it possible to utilize the real estate professional status on this triplex for 1 of the units? How would that work?

I'm looking into a cost segregation study on this property to accelerate depreciation as well.

Thanks!

[Sean O'Keefe]

Cody Shepherd First, for your wife to qualify for Real Estate Professional Status (REPS) she would need to meet the IRS requirements to be considered one.

Next, you might find this post from John Malone on Common Questions on STR and REPS helpful (great post John).

Based on what you say, it's unlikely, but the details are important and what you've provided isn't enough. I'd suggest chatting with a tax professional for more clarify and they can help you nail down the facts

[Joseph Palmiero]

Hours spent on STRs generally do not count towards real estate professional status.  

[Cody Shepherd]

@Sean O'Keefe

Will do!

I'll consult my CPA

I was wondering if anyone had experience with a STR rental within a duplex or triplex

[Ashish Acharya]

There is not need for REPS status for what you are doing. You just need to meet the material participation rules.