Did Junior trash my rental-house write-off?

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in Small Business Tax

Q: We have a vacation home at the Jersey shore. We normally only use the house ourselves two weeks in September. But this year my teenage son and his friends spent a few weekends there in the fall. Do we have a tax problem? G.A., Mahwah, N.J.

A: Maybe. As you may know, if your personal use of the rental home exceeds 14 days (or 10 percent of the rental days, if greater), you can deduct your rental expenses only up to the amount of your rental income. That means no deducting losses. Your son's weekend trips count as personal use, so you're clearly over the 14-day mark. But that usually affects your tax situation only if you expect to claim a loss on the rental. Advice: In the future, you might want to combine work and pleasure to stay at the 14-days-or-less-personal-use level, if that allows you to deduct losses. If the primary purpose of a trip is to make the place shipshape, the days spent at the home don't count as personal use.

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