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I have tried to Airbnb for a short term rental and I realized that I don’t earn that much after Airbnb fee and tax. A naive question here is how I optimize for the benefit or tax reduction? Obviously increasing the rate will not help.
Talk to a tax professional. You can write off a lot of expenses.
The fee is small for the host. Most the fees are paid by the guest in addition to your asking price, so really confused why you say the fee interfere with making money.. and the tax is no different than any other income, so hmmm ... Maybe you just aren't good at it and don't get many bookings... For what it is worth, I've been renting for 5 years and it is an extra 50k income with tax loopholes...
Yeah you made me realize that the tax is no different from other income but can I claim a new coffee machine for tax deduction?
This is not profesional advise, but, if you buy a coffee machine just for the business you can write that off. You can write off almost every single one of this kind of business expenses, even if you buy a car or a new Macbook pro 'just' for you business. Add on top of this, part of you internet bill, phone, electricity, water, rent of the property you are currently living in, your own car. Not only that, you can even have a negative income a certain year, and in the following years you can write that off.
Depreciation is a thing that can help you with your taxes, and your cpa should know that.
Depreciation applies for Airbnb as well?
Sure.. if you own the property you can deduct the appreciation... But you will be taxed later on when you sell the property for the full gain, less the amount not yet depreciated, unless you roll the gains into a new investment property
Sell the place and stop contributing to problems. The scam is up. If you don’t know these answers, you shouldn’t be a property owner or Airbnb host.
Why so?
I’m not writing out things you should already know