CalculateRealEstateROI

Tax Strategy

STR Tax Loophole

Short-term-rental exception classifying STR with <7-day avg stay as non-passive without REPS.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Plain-English explanation

Cost seg + bonus on an STR can offset W-2 income for material-participation owners.

Examples

  • $600k STR with $150k year-1 cost seg deduction offsetting W-2 income.

Common mistakes

  • Outsourcing all operations and failing material participation tests.

Related questions