asked

I own a summer cottage bought in 2007 that I rent out each year. I do not occupy it so it is 100% rental. The following is the income for each year: 2007: $3600 rent - $4940 expenses = $1340 net loss for year. 2008: $3568 rent - $4030 expenses = $462 net loss for year. 2009: $2400 rent - $4261 expenses = $1861 net loss for year. 2010: $0 rent (no one occupied while we refurbished dwelling) $700 expenses = $1400 net loss for year. How do I handle 2010 taxes? Can I claim the $1400 loss in the same way as previous years? Will the IRS object to 4 years of losses in a row and apply restrictions or worse, audit previous year returns? Any passive income rules broken here? What if I never show a profit for the five years 2007 - 2011?

February 15th, 2024

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