STR Tax Savings Calculator

It depends on your purchase price, how much of it a cost segregation study can move into short-lived property, your tax bracket and whether you materially participate. In the example below, a $500,000 short-term rental with a 30% cost segregation reclass and $20,000 of furniture produces $143,895 of first-year depreciation, which saves a married couple earning $300,000 about $30,585 in federal tax in 2026, plus state tax. The calculator above runs your own numbers on the real 2025 and 2026 tax brackets.

Usually 39. Residential rental property (27.5 years) must get 80% or more of its rent from dwelling units, and a unit in a building where more than half the units are used on a transient basis is not a dwelling unit (IRC 168(e)(2)(A)(ii)). For a single short-term rental house, that is the whole house. Treasury regulations treat accommodations as transient when the rental period is normally less than 30 days (Treas. Reg. 1.48-1(h)(2)(ii), a rule practitioners apply by analogy), so a short-term rental is usually depreciated over 39 years as nonresidential real property. This is a separate rule from the 7-day average stay, which decides whether the rental is passive. Calculators that use 27.5 years overstate the building's yearly depreciation by about 42%. Ask your CPA which applies to your property.

Yes, for property acquired after January 19, 2025. The One Big Beautiful Bill Act (Public Law 119-21) restored permanent 100% bonus depreciation for it. Property acquired earlier under a written binding contract stays on the old phase-down: 40% if placed in service in 2025 and 20% in 2026. "Acquired" usually means the day you closed; a purchase contract signed earlier counts only if it was binding, and one whose only penalty is losing an earnest-money deposit under 5% of the price is not (Treas. Reg. 1.168(k)-2(b)(5)). For 2025 returns you can also elect 40% instead of 100% for the year (IRC 168(k)(10)); the calculator assumes you do not.

Yes. The STR loophole works because a rental with an average stay of 7 days or less is not a "rental activity" under the passive loss rules, so the loss is non-passive only if you materially participate. A rental with an average stay of 30 days or less also qualifies if you provide significant personal services, such as daily cleaning or meals (Treas. Reg. 1.469-1T(e)(3)(ii)(B)). The most common tests are more than 100 hours and at least as much as anyone else, more than 500 hours, or doing substantially all the work (Treas. Reg. 1.469-5T(a)). Without material participation the loss is passive and is suspended until you have passive income or sell, and the $25,000 allowance for rental losses does not apply, because such an STR is not a rental activity. Keeping a log of your hours as you go is how you prove it if the IRS asks.

Yes. The excess business loss limit (IRC section 461(l)) caps the net business loss that can offset wages and other non-business income in one year: $313,000 single and $626,000 married filing jointly for 2025, and $256,000 and $512,000 for 2026. Anything above the cap becomes a net operating loss you carry forward. The calculator applies this cap.

Not always. Several states, including California, do not follow federal bonus depreciation, so the state deduction in year one can be much smaller. The calculator applies your state rate to the federal loss, up to the income you have, which is an upper bound. Check your state's conformity with your CPA.

When you sell, depreciation you took is recaptured. Depreciation on 5-year property and furniture, and bonus depreciation on 15-year land improvements above straight line, is taxed at ordinary rates (IRC 1245 and 1250, Treas. Reg. 1.168(k)-2(g)(3)); the building's depreciation at up to 25%. A 1031 exchange can defer it, and holding until death can erase it through the basis step-up. The savings are real, but they are largely a deferral plus the rate difference, not all a permanent reduction.

REPSLog does not qualify you: you qualify by materially participating in a rental whose average stay is 7 days or less. REPSLog is the record that proves it. It keeps an hour counter for each short-term rental against the 100-hour or 500-hour test, shows your hours and your spouse's next to your cleaner's, co-host's and contractors' so you can see whether anyone participated more than you, keeps receipts and photos with each entry, and exports the year for your CPA. Whether you qualify is your CPA's call.

Yes. Mark a property as a short-term rental and every hour logged against it goes to that property's own counter, 100 hours by default or 500 if your CPA groups your rentals, separate from the 750-hour REPS count. Long-term and short-term rentals live in one account with a toggle between them. STR tracking is on every plan, including Free (1 property and 5 entries), on iPhone, Android and the web.

Yes. Log their work as a participant on the entry. Each short-term rental then shows a breakdown by participant, so you can check the 100-hour test's condition that nobody participates more than you do.

It helps. With Booking Calendar Sync (Premium) you connect a listing's Airbnb, Vrbo or other iCal link, each stay appears on your REPSLog calendar, and REPSLog suggests the work around it, such as cleaning and turnover or restocking, as a prefilled entry. A stay never becomes an entry on its own: you review and save each one.

A year of entries as PDF, Excel and CSV files, with short-term rental entries in their own files. Each row has the property, date, hours, description, who did the work and the category, and you can include your receipts and the date and time each entry was created and last edited, which shows the log was kept as you went.

New accounts are offered a 14-day free trial of Starter or Premium with full access; cancel before day 14 and you pay nothing. There is also a Free plan (5 entries and 1 property, and it never expires), Starter at $14.99 a month or $149.99 a year, and Premium at $19.99 a month or $199.99 a year, which adds voice logging, AI autofill, calendar and booking sync, reminders and team access.

No. It is an estimate for planning a conversation with your CPA. It assumes the standard deduction, one property, no personal use of the rental, and a first-year result, and it applies the excess business loss limit to this rental alone. Your real result depends on your whole return.