Friday, July 17th, 2009 at
9:33 am

I understand that if you rent your property AND use it for personal use a few days out of the year, your accounting becomes very complicated. Our accountant said it actually would be less expensive for us to pay to stay somewhere else than to routinely mix personal use and renting in the same property. Since we use a property manager, can we get around this problem by renting the unit to ourself as if we were a customer? (Basically, the flow of money goes through the PM as if we were a normal customer, but then comes back to us eventually as rental income minus the PM fees.) I don’t want to do this if it is considered underhanded.
I realize that some people will suggest that we consider all days of our stay as ‘business’, but since this is an established rental unit, we cannot justify more than 2 days for business activity unless there is some major renovation going on.
Assuming “Renting to ourselves” is okay, it would appear to have the effect of increasing our annual rental income, (which will increase taxable income.)
Rent Back Fast