New (tax) year, new help!

Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

Question

Why did UltraTax CS allow a loss on Schedule E for my client's vacation home?

Answer

The rental portion of the following direct rental expenses are fully deductible and not limited by the amount of vacation home rental income:

• Mortgage interest
• Qualified mortgage insurance premiums
• Real estate taxes
• Advertising
• Management fees
• Commissions
• Other direct rental expenses

All other types of expenses are treated as expenses directly related to operating or maintain the rental unit and are limited by rental income.

UltraTax CS produces a Vacation Home Worksheet detailing how any allowable loss was calculated. To generate the worksheet, click the Asset tab in the Rent and Royalty folder and choose Setup > Activity. Click the Vacation Home Percentage button and enter the number of days in the Number of days home rented field. Click OK twice to close both dialogs.

Related topic: Vacation home calculations FAQs (1040)

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