Used as a home and rented 15 days or more: Rental Property Taxes (2025 IRS Guide)
This guide covers “Used as a home and rented 15 days or more” within rental property taxes. The following material presents the IRS treatment of this topic, including the qualifications, exceptions, and examples in the source section. Read the rules alongside the facts of your own situation before deciding what to report, deduct, or document.
Adapted from Publication 527 (2025), Residential Rental Property, published by the Internal Revenue Service. This guide retains the source edition’s years, amounts, deadlines, and examples. It is guidance for that edition, not a statement that the same figures apply to every tax year.
Context for these rules
If you have any personal use of a dwelling unit (including a vacation home) that you rent, you must divide your expenses between rental use and personal use. In general, your rental expenses will be no more than your total expenses multiplied by a fraction, the denominator of which is the total number of days the dwelling unit is used and the numerator of which is the total number of days actually rented at a fair rental price. Only your rental expenses may be deducted on Schedule E (Form 1040). Some of your personal expenses may be deductible on Schedule A (Form 1040) if you itemize your deductions.
You must also determine if the dwelling unit is considered a home. The amount of rental expenses that you can deduct may be limited if the dwelling unit is considered a home. Whether a dwelling unit is considered a home depends on how many days during the year are considered to be days of personal use. There is a special rule if you used the dwelling unit as a home and you rented it for less than 15 days during the year.
Used as a home and rented 15 days or more
Used as a home and rented 15 days or more.
If you use a dwelling unit as a home and rent it 15 days or more during the year, include all your rental income in your income. Because you used the dwelling unit for personal purposes, you must divide your expenses between the rental use and the personal use, as described earlier in this chapter under Dividing Expenses. The expenses for personal use aren’t deductible as rental expenses.
If you had a net profit from renting the dwelling unit for the year (that is, if your rental income is more than the total of your rental expenses, including depreciation), deduct all of your rental expenses. You don’t need to use Worksheet 5-1.
However, if you had a net loss from renting the dwelling unit for the year, your deduction for certain rental expenses is limited. To figure your deductible rental expenses and any carryover to next year, use Worksheet 5-1.
Worksheet 5-1. Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home
Use this worksheet only if you answer “Yes” to all of the following questions.
| |||||
| PART I. Rental Use Percentage | |||||
| A. | Total days available for rent at fair rental price | A. | _____ | ||
| B. | Total days available for rent (line A) but not rented | B. | _____ | ||
| C. | Total days of rental use. Subtract line B from line A | C. | _____ | ||
| D. | Total days of personal use (including days rented at less than fair rental price) | D. | _____ | ||
| E. | Total days of rental and personal use. Add lines C and D | E. | _____ | ||
| F. | Percentage of expenses allowed for rental. Divide line C by line E | F. | . | ||
| PART II. Allowable Rental Expenses | |||||
| 1. | Enter rents received | 1. | _____ | ||
| 2a. | Enter the rental portion of deductible home mortgage interest. See instructions | 2a. | _____ | ||
| b. | Enter the rental portion of deductible real estate taxes. See instructions | b. | _____ | ||
| c. | Enter the rental portion of deductible casualty and theft losses. See instructions | c. | _____ | ||
| d. | Enter direct rental expenses. See instructions | d. | _____ | ||
| e. | Fully deductible rental expenses. Add lines 2a–2d. Enter here and on the appropriate lines on Schedule E. See instructions | 2e. | _____ | ||
| 3. | Subtract line 2e from line 1. If zero or less, enter -0- | 3. | _____ | ||
| 4a. | Enter the rental portion of expenses directly related to operating or maintaining the dwelling unit (such as repairs, insurance, and utilities) | 4a. | _____ | ||
| b. | Enter the rental portion of excess mortgage interest. See instructions | b. | _____ | ||
| c. | Enter the rental portion of excess real estate taxes. See instructions | c. | _____ | ||
| d. | Carryover of operating expenses from 2024 worksheet | d. | _____ | ||
| e. | Add lines 4a–4d | e. | _____ | ||
| f. | Allowable expenses. Enter the smaller of line 3 or line 4e. See instructions | 4f. | _____ | ||
| 5. | Subtract line 4f from line 3. If zero or less, enter -0- | 5. | _____ | ||
| 6a. | Enter the rental portion of excess casualty and theft losses. See instructions | 6a. | _____ | ||
| b. | Enter the rental portion of depreciation of the dwelling unit | b. | _____ | ||
| c. | Carryover of excess casualty and theft losses and depreciation from 2024 worksheet | c. | _____ | ||
| d. | Add lines 6a–6c | d. | _____ | ||
| e. | Allowable excess casualty and theft losses and depreciation. Enter the smaller of line 5 or line 6d. See instructions | 6e. | _____ | ||
| PART III. Carryover of Unallowed Expenses to Next Year | |||||
| 7a. | Operating expenses to be carried over to next year. Subtract line 4f from line 4e | 7a. | _____ | ||
| b. | Excess casualty and theft losses and depreciation to be carried over to next year. Subtract line 6e from line 6d | b. | _____ | ||
Worksheet 5-1 Instructions. Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home
| Caution. Use the percentage determined in Part I, line F, to figure the rental portions to enter on lines 2a–2c, 4a–4c, and 6a–6b of Part II. | ||||
| Line 2a. | If you are claiming the standard deduction, do not report an amount on line 2a; instead, report the rental portion of your mortgage interest on line 4b. | |||
| If you are itemizing your deductions on Schedule A, figure the amount of mortgage interest to include on line 2a by using the following steps. | ||||
| Step 1. Treat all the mortgage interest you paid for mortgages secured by your home(s) as a personal expense and figure the amount that would be deductible as an itemized expense on Schedule A. See Pub. 936 for more information about figuring the home mortgage interest deduction and the limits that may apply. | ||||
| Step 2. Include on line 2a the rental portion of deductible mortgage interest figured in Step 1 that is attributable to the home you are renting. | ||||
| Note: Be sure to claim only the personal portion of your deductible mortgage interest on Schedule A. The personal portion of mortgage interest on the dwelling unit doesn’t include the rental portion you reported on line 2a of this Worksheet 5-1 or any portion that you deducted on other forms, such as Schedule C or F. | ||||
| Line 2b. | If you are claiming the standard deduction, do not report an amount on line 2b; instead, report the rental portion of your real estate taxes on line 4c. | |||
| If you are itemizing your deductions on Schedule A, figure the amount to report on line 2b by using the following steps. | ||||
| Step 1. If the total of your state and local income (or, if elected on your Schedule A, general sales) taxes, real estate taxes, and personal property taxes is not more than $40,000 ($20,000 if married filing separately), enter the rental portion of the real estate taxes attributable to the dwelling unit you are renting on line 2b. | ||||
| Step 2. If you do not meet the condition of Step 1, use the following worksheet to figure the amount to include on line 2b. | ||||
| Line 2b Worksheet | ||||
| 1. | Enter your state and local income taxes (or, if you elect on Schedule A, your state and local general sales taxes) that are personal expenses | _____ | ||
| 2. | Enter all the state and local real estate taxes you paid on the dwelling unit you are renting | _____ | ||
| 3. | Enter any other state and local real estate taxes you paid that are a personal expense and not included on line 2 | _____ | ||
| 4. | Enter your state and local personal property taxes that are a personal expense | _____ | ||
| 5. | Add lines 1 through 4 | _____ | ||
| 6. | Multiply line 2 by the percentage of expenses allowed for rental (Part I, line F) | _____ | ||
| 7. | Subtract line 6 from line 5 | _____ | ||
| 8. | Subtract line 7 from $40,000 ($20,000 if married filing separately). If zero or less, enter -0- | _____ | ||
| 9. | Real estate taxes reported on line 2b. Enter the smaller of line 6 or line 8 here and on line 2b | _____ | ||
| 10. | Excess real estate taxes reported on line 4c. Subtract line 9 from line 6 | _____ | ||
| Note: Be sure to report only the personal portion of your real estate taxes on line 5b of Schedule A. The personal portion of real estate taxes on the dwelling unit doesn’t include the rental portion you reported on line 2b of this Worksheet 5-1 or any portion that you deducted on other forms, such as Schedule C or F. | ||||
| Line 2c. | If you are claiming the standard deduction and you are not increasing your standard deduction by a net qualified disaster loss, do not report an amount on line 2c; instead, report the rental portion of your casualty losses on line 6a. | |||
| If you are itemizing your deductions on Schedule A or filing a Schedule A to increase your standard deduction by a net qualified disaster loss, figure the amount to report on line 2c by using the following steps. | ||||
| Step 1. Complete a worksheet version of Section A of Form 4684 treating all your casualty losses (and gains) as personal expenses. If you are itemizing your deductions, when completing line 17 of this worksheet version of Form 4684, enter 10% of your adjusted gross income figured without your rental income and expenses from the dwelling unit. Don’t file this worksheet version of Form 4684; instead, keep it for your records. You will complete a separate Form 4684 to attach to your return using only the personal portion of your casualty losses (and gains) for Section A. | ||||
| Step 2. Include on line 2c the rental portion of the loss amounts from lines 15 and 18 of this worksheet version of Form 4684 that are the result of a federally declared disaster. If you are claiming an increased standard deduction instead of itemizing your deductions, only use the rental portion of a net qualified disaster loss on line 15 of the worksheet version of Form 4684 for this Step 2. | ||||
| Note: Be sure to use only the personal portion of your casualty losses (and gains) when completing Section A of the separate Form 4684 you attach to your return. The separate Form 4684 you attach to your return is used to figure the casualty losses you can include on line 15 of Schedule A and the net qualified disaster losses you can include on line 16 of Schedule A. You will report casualty and theft losses attributable to your rental activity in Section B of the separate Form 4684 you attach to your return. | ||||
Worksheet 5-1 Instructions—Continued
| Line 2d. | Enter the total of your rental expenses that are directly related only to the rental activity. These include interest on loans used for rental activities other than to buy, build, or improve the dwelling unit. Also, include rental agency fees, advertising, office supplies, and depreciation on office equipment used in your rental activity. | |||
| Line 2e. | You can deduct the amounts on lines 2a, 2b, 2c, and 2d as rental expenses even if your rental expenses are more than your rental income. Enter the amounts on lines 2a, 2b, and 2d on the appropriate lines of Schedule E. Include the amount from line 2c with the casualty loss from line 6e, if any, in Section B of Form 4684, on line 27, and enter “See attached statement” above line 27. Attach a statement to your tax return showing how you calculated the deductible loss (you can use the worksheet as your attachment). | |||
| Line 4b. | If you are claiming the standard deduction, enter the rental portion of all the home mortgage interest paid for loans used to buy, build, or substantially improve the dwelling unit you are renting on line 4b. Do not include mortgage interest on a loan that did not benefit the dwelling unit (for example, a home equity loan used to pay off credit card bills, to buy a car, or to pay tuition costs). | |||
| If you are itemizing your deductions and the amount you figured in Step 1 under Line 2a was less than the full amount of interest you paid because of the limits on deducting home mortgage interest as a personal expense, include on line 4b the rental portion of the excess attributable to the loans used to buy, build, or substantially improve the dwelling unit you rented. | ||||
| Line 4c. | If you are claiming the standard deduction, enter the rental portion of all the real estate taxes paid on the dwelling unit you rented. | |||
| If you are itemizing your deductions and you used the Line 2b Worksheet to figure the amount to include on line 2b, then include the amount from line 10 of the Line 2b Worksheet on line 4c; otherwise, do not enter an amount on line 4c. | ||||
| Line 4f. | You can deduct the amounts on lines 4a, 4b, 4c, and 4d as rental expenses on Schedule E only to the extent they aren’t more than the amount on line 4f.* | |||
| Line 6a. | If you are claiming the standard deduction and not increasing it by a net qualified disaster loss, enter the rental portion of all casualty losses attributable to the dwelling unit you rented. | |||
| If you are itemizing your deductions on Schedule A or filing a Schedule A to increase your standard deduction by a net qualified disaster loss, enter the rental portion of the casualty losses attributable to the dwelling unit you rented that are in excess of the amount you figured on lines 15 and 18 of your worksheet version of Form 4684. | ||||
| Line 6e. | You can deduct the amounts on lines 6a, 6b, and 6c as rental expenses only to the extent they aren’t more than the amount on line 6e.* Include the depreciation from line 6e, if any, on the appropriate line of Schedule E. Include the casualty loss from line 6e, if any, with the casualty loss from line 2c in Section B of Form 4684, on line 27, and enter “See attached statement” above line 27. Attach a statement to your tax return showing how you calculated the deductible loss (you can use the worksheet as your attachment). | |||
- * Allocating the limited deduction. If you can’t deduct all of the amount on line 4e or 6d this year, you can allocate the allowable deduction in any way you wish among the expenses included on line 4e or 6d. Enter the amount you allocate to each expense on the appropriate line of Schedule E, Part I, or if a casualty loss, as instructed earlier on Form 4684, line 27.
Using the guidance
Keep the documents that establish the dates, amounts, and circumstances described above. References to other chapters, forms, worksheets, or earlier and later sections refer to the linked IRS publication. Check the full publication and its updates before relying on a rule for a different tax year or a situation not addressed here.
Sources and further reading
- Publication 527 (2025), Residential Rental Property: Personal Use of Dwelling Unit (Including Vacation Home) — Reporting Income and Deductions — Used as a home and rented 15 days or more — Internal Revenue Service; 2025 edition.
The cited U.S. government text is in the public domain. Source accessed October 28, 2026. Fynoptic has organized this material for educational use and is independent of, and not endorsed by, the IRS.