are there any rules on traveling to an owned out of state rental?

[Arthur Schwartz]

I have several rental homes located out of state. Are there any rules on how often you can travel there, and deduct the travel cost? Can I travel once a year? Twice? Three times?  Are there any travel expenses which I can or cannot deduct?  Thank you!

[Linda Weygant]

The IRS has "Ordinary and Necessary" as a guide for what is deductible.  Is it Ordinary to travel to check on your properties three times per year?  Is it Necessary?  (your own neuroses or paranoia about your property does not meet the criteria for Necessary)

For example, I have a client with a property in Puerto Rico.  After the hurricanes, their property manager was unable to work due to their own crises and couldn't tell my clients if the property was still standing.  Governmental personnel also could not/would not tell them.  So when it was deemed safe, they got on a plane and flew down - to discover that their property was indeed still standing and ok.  They spent 5 days cleaning debris and making repairs.  This is an example of Ordinary and Necessary due to the circumstances.

I had another client who had a rental property about 125 miles away from their home.  Neighbors kept complaining about certain behavior of the tenants.  Client drove down to the property, in the middle of the night, 3 or 4 times a week for a period of about 6 weeks to try to "catch" the tenants in the act.  Nothing ever came of it and it was eventually determined that the neighbors had a personal conflict with the tenants that had nothing to do with lease violations, etc.  Ordinary?  debateable, but probably. Necessary - yeah.  Dealing with possible lease violations is important.  So the mileage is deductible.

Yet another client who owns property back in their hometown, several hours away by airplane.  Goes there 3 or 4 times a year, especially during holidays, with the family "to check on the property".  Was there a complaint?  No.  Was there a repair to be taken care of?  No, the property manager does all of that.  So clearly not Ordinary or Necessary.

If you do have an Ordinary and Necessary trip to your property, the IRS does take certain issues into play.  Let's say you go for 10 days to your condo in Orlando.  You spend one day doing some touch up painting and light repairs and 9 days going to Disney World.  The IRS will allow for the number of days that there was actually a business reason to be there.  So in this case, the travel expenses (but not the tickets to Disney World) would be 10% deductible JUST FOR YOU (or the person doing the work).  Your non participatory spouse and children's travel expenses would not be deductible.

Make sense?