DEFINITION of 'IRS Publication 527 - Residential Rental Property (Including Rental of Vacation Homes)'

A document published by the Internal Revenue Service (IRS) that provides tax information for individuals who own residential properties that are rented out for income, either part of the year or all year. Typically, all income earned from rental properties is reported to the IRS, though the type of rental activity will alter which sections of the tax form that income is reported. IRS Publication 527 outlines how to account for property depreciation, what types of deductions can be made on rental income as well as what to do if only part of a property is rented.

BREAKING DOWN 'IRS Publication 527 - Residential Rental Property (Including Rental of Vacation Homes)'

Because taxpayers may only rent one piece of a property or might live in that rented property for part of a year, such as with a vacation home, taxpayers should pay close attention to how rental income is treated for their situation by the IRS.

Taxpayers who sell rental property should refer to IRS Publication 544 (Sales and other Disposition of Assets) or IRS Publication 523 (Selling Your Home).

RELATED TERMS
  1. Residential Rental Property

    A type of property that derives more than 80% of its revenue ...
  2. Income Property Mortgage

    A loan given to an investor to purchase a residential or commercial ...
  3. Real Estate Investment Group

    An organization that builds or buys a group of properties and ...
  4. Rental Real Estate Loss Allowance

    A federal tax deduction of up to $25,000 that is available to ...
  5. Investment Property

    A real estate property that has been purchased with the intention ...
  6. Income Approach

    A real estate appraisal method that allows investors to estimate ...
Related Articles
  1. Taxes

    Getting U.S. Tax Deductions On Foreign Real Estate

    If your home or second home is not in the United States, you can still get U.S. tax deductions. How many and what kind depends on whether you also rent it.
  2. Investing

    Rent Revenue: A Growing Income Source for U.S. Households

    Never before has rental revenue represented such a large share of income gained by American households.
  3. Investing

    Tax Breaks For Second-Home Owners

    The tax rules on a second home vary, depending on how the property is used.
  4. Financial Advisor

    How to Reduce Real Estate Investment Taxes

    Real estate tax law is not the same for rental properties as it is for residences. These tips can help you pay less in taxes.
  5. Managing Wealth

    The Pros And Cons Of Owning Rental Property

    Owning rental property can be a rewarding and profitable experience, but it comes with some real risks.
  6. Investing

    5 Ways Rental Properties Jumpstart Your Finances

    Rental properties can help pay your mortgage, provide tax benefits and create retirement income.
  7. Investing

    Is It Worth Buying a Second Home to Rent?

    Mortgage interest rates are low, but consider these dos and don'ts before making the leap into rental property ownership.
  8. Investing

    4 Ways to Value a Real Estate Rental Property

    Several approaches to evaluate real estate for investment purposes.
RELATED FAQS
  1. Is it possible to refinance a house you're renting out?

    Find out whether it is possible to refinance rental property. Lenders have strict qualifying standards and expect owners ... Read Answer >>
Hot Definitions
  1. Return On Equity - ROE

    The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability ...
  2. Bond

    A bond is a fixed income investment in which an investor loans money to an entity (corporate or governmental) that borrows ...
  3. Whole Life Insurance Policy

    A life insurance contract with level premiums that has both an insurance and an investment component. The insurance component ...
  4. Compound Annual Growth Rate - CAGR

    The Compound Annual Growth Rate (CAGR) is the mean annual growth rate of an investment over a specified period of time longer ...
  5. Capital Asset Pricing Model - CAPM

    A model that describes the relationship between risk and expected return and that is used in the pricing of risky securities. ...
  6. Internal Rate Of Return - IRR

    A metric used in capital budgeting measuring the profitability of potential investments.
Trading Center