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The IRS provides a safe harbor for vacation rentals. In the 2018 New England Real Estate Journal article written by Northern 1031 Exchange Senior Vice President, John Starling, he highlights the details and the differences between a second home and a vacation rental.
A second home is not exchangeable property, however, by following a few rules a vacation home can qualify as exchangeable property under the IRS safe harbor. Starling examines details of the safe harbor rules along with examples of properties that may still qualify for an exchange but lie outside the safe harbor. He also notes that if you have rental income, you must report it to the IRS using Form 1040 and outlines the various questions that must be answered. Lastly, he stresses the importance of discussing your rental income details and tax liability with your CPA or tax adviser.
Financial wellness is the state of having a healthy relationship with your finances, where you effectively manage your money, plan for the future, and feel secure in your financial decisions. Achieving financial wellness doesn’t happen overnight — it is a process that may take time and effort to achieve.
Bank changes shouldn't slow down your business. As your trusted partner, we'll help you stay ahead with practical steps to navigate any transition smoothly.
Northern Bank announced today that it would begin accepting applicants for its annual $5,000 college scholarship award.
Northern Bank is a full-service bank dedicated to providing practical, common sense financial solutions to help our customers live their lives and grow their businesses. From deposit products to loans to payment and collections services, we work hands-on with our entrepreneurial customers, both locally and across the country, to provide the financial support they need to realize their personal and business goals. Founded in 1960, Northern Bank has assets of $3.11 billion with 12 locations serving communities throughout Middlesex County. Northern Bank is a Member of the FDIC, and an Equal Housing Lender.
Contact us now to learn more about how Northern Bank can help you realize your goals and dreams.