Vacation home not exempt from real estate taxes
DEAR BOB: I own a beach condo, which I rented out last summer through a rental agency. This summer I want to use it as my second home, but periodically allow family and close friends to use it at a reduced rental rate to help with expenses. Am I required to pay tax on that rental income? –Alice H.
DEAR ALICE: If you rented your beach condo for more than 14 days in 2005, you are required to report that rental income and deduct applicable expenses on Schedule E of your 2005 income tax returns. However, if the rental days were less than 14, you can keep the rent money and Uncle Sam doesn’t care.