3 ms·

How does Airbnb provide a tax shelter? Also aren't they all doing "buy, borrow, die" thing so don't need a tax shelter?

• Spooky23 1y ago
  The “big beautiful bill” essentially subsidizes short term rentals by allowing investors to fully depreciate the properties year 1.
• fragmede 1y ago
  You turn personal housing costs into business deductions. The property throws off paper losses through accelerated depreciation while generating cash flow and then you get to reclassify lifestyle spending as investment activity.
  • anovikov 1y ago
    So in other words, someone can rent out a property for a small portion of time on airbnb, while living it in the rest of the time, and yet count everything spent on it as a deductible business expense?
    • Spooky23 1y ago
      You can’t live in it. Average stay is has to be <7 days. It makes sense to do if you’re in the 35% bracket. You buy a condo or a house. So you buy a house, airbnb it for one year, then rent for 2-5 more. Then you 1031 exchange it and do it again. If you don’t trade up, you have to keep the property or they recapture the bonus depreciation on a prorata basis later. Airbnb hasn’t been about couchsurfing in a long time. It’s a mechanism to monetize real estate under more favorable tax rules.
      • anovikov 1y ago
        Isn't this a very US-centric view? I mean, Airbnb operates worldwide.