A short-term rental CPA who connects the property to your tax return.
A short-term rental CPA, often called an Airbnb CPA or STR CPA, handles the tax and accounting work for a property rented by the night or week: how the activity is classified under the passive-activity rules, whether material participation can be supported, depreciation and any cost segregation study, platform payout reconciliation, and the federal and state returns. Taxstra does this remotely for owners nationwide, led by Bryan Martin, a CPA who is also a licensed real estate broker. A short average stay alone does not establish that a loss can offset your salary.
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Why the payout is not the whole accounting picture
Suppose a booking platform reports $12,000 of gross rental charges, withholds $360 of host fees, and deposits $11,640. Recording only the deposit hides both the gross activity and the fee. Refunds, lodging taxes, cleaning charges, and deposits can add further reconciliation questions.
This hypothetical example is about record quality, not tax savings. We match the platform activity to the books and determine the treatment of each item from the contract and transaction facts. Good records also make property performance easier to compare.
Book your free 30-minute short-term rental tax fit call
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Who this service is for
You may be buying your first vacation rental, adding properties, changing managers, or trying to reconcile a platform statement with a tax return. The right engagement starts with the transaction and your household, not a promised deduction.
Taxstra combines CPA-led tax work with real-estate experience. Bryan is a CPA, MBA, and real estate broker. We work remotely with owners nationwide and define the entity, property, and individual returns included in the engagement.
- High-income professionals evaluating a purchase before closing or placing a property in service.
- Owners who need participation, personal use, financing, and depreciation reviewed together.
- Hosts with several properties, entities, booking platforms, or operating states.
- Owners commissioning a cost segregation study who need the results connected to their return.
What to ask any STR CPA before you buy
Taxstra is a CPA firm that handles the short-term rental loophole for W-2 earners, including software engineers and other tech employees. We check the two tests that decide the outcome, an average guest stay of seven days or less and material participation by you or your spouse, then coordinate the cost segregation study, the 2026 bonus depreciation election, and the return. We serve 1,000+ clients in all 50 states, fully remote.
| Question to ask | Why it matters | How Taxstra handles it |
|---|---|---|
| How will you compute my average guest stay? | Seven days or less takes the property out of the rental definition. | We compute it from the booking export for the full year. |
| Which material participation test will I use? | Most W-2 owners rely on more than 100 hours and not less than anyone else, including cleaners. | We set up an hours log on day one and check it during the year. |
| Who orders the cost segregation study? | The study identifies shorter-lived components; the CPA decides how they are claimed. | We coordinate with an engineering firm and evaluate the report. |
| Will the excess business loss limit cap my deduction? | For 2026, net business losses above $512,000 joint ($256,000 other filers) carry forward. | We model the cap before you close. |
| What happens when I sell? | Accelerated depreciation is recaptured. | We project recapture in the plan. |
What we evaluate and what you receive
| Workstream | What the work addresses | Records or output |
|---|---|---|
| Property and ownership | Who owns the asset, when it became available for rent, financing, and personal use | Ownership and placed-in-service facts documented for the return |
| Operating activity | Stay history, services, participation, and property-manager involvement | A supported activity classification and questions requiring follow-up |
| Depreciation | Land allocation, asset schedules, prior depreciation, and any engineering study | Depreciation implementation and any separately scoped accounting-method work |
| Return coordination | Rental results, household income, basis, at-risk and other applicable loss limits | Entity and individual filings identified in the engagement |
| Ongoing accounting | Gross bookings, platform fees, deposits, expenses, and property-level reporting | A separately agreed bookkeeping and reporting scope |
We define deliverables, filing responsibilities, review cadence, and fees before work begins. A planning consultation is not a guarantee that a particular loss will be deductible.
What an STR engagement includes
An engagement follows the same sequence whether you own one cabin or a dozen units. The free 30-minute call comes first; the tax work begins once a written proposal is signed.
- A free 30-minute call with our team: your properties, what you need, how we can help, and whether we are a good fit.
- A written proposal listing the entities, properties, returns, and bookkeeping included, with the fee, before any work starts.
- Onboarding through a secure client portal: prior returns, closing statements, booking history, and participation records.
- An activity review: average stay, services provided to guests, personal use, and who performed the work, documented before the return is prepared.
- Depreciation setup: land allocation, asset schedules, and coordination with a cost segregation provider if a study is ordered.
- Books and platform reconciliation, when included: gross bookings, host fees, cleaning fees, lodging taxes, and deposits matched by property.
- Returns and planning check-ins: federal and state filings, plus a year-end check on new purchases, placed-in-service dates, and estimated payments.
Scope, deliverables, and fees are confirmed in writing before work begins. Tax advice and your plan come after you engage us.
The facts that change the tax answer
For the passive-activity rules, an average customer-use period of seven days or less is one exception to the definition of a rental activity. Material participation is a separate question. Personal use, basis, the at-risk rules, and other limitations can still affect the result.
The tax classification also depends on the services you provide. Do not assume that every short stay belongs on the same schedule or has the same self-employment-tax treatment. We review the operating facts and applicable rules.
A cost segregation study changes the depreciation analysis; it does not independently prove that you can use the resulting loss. The engineering work, tax implementation, and loss analysis need to agree.
2026 rules and figures STR owners ask about
| Rule | What it says | Primary source |
|---|---|---|
| Seven-day average stay | If the average guest stay is 7 days or less, the property is not a "rental activity" for the passive-activity rules. Material participation is still a separate test. | Temp. Treas. Reg. 1.469-1T(e)(3)(ii)(A) |
| 30-day stay with services | An average stay of 30 days or less is also excluded when significant personal services are provided to guests. | Temp. Treas. Reg. 1.469-1T(e)(3)(ii)(B) |
| Material participation | Common tests: 500 or more hours in the year, more than 100 hours and not less than any other individual, or substantially all of the participation in the activity. | Temp. Treas. Reg. 1.469-5T(a) |
| Personal use | The property is treated as a residence when your personal use exceeds the greater of 14 days or 10% of the days rented at a fair price. | IRC 280A(d)(1) |
| Fewer than 15 rental days | If you use the home as a residence and rent it fewer than 15 days in the year, the rent is excluded from income and rental expenses are not deducted. | IRC 280A(g) |
| Bonus depreciation | 100% bonus depreciation is permanent for qualified property acquired and placed in service after January 19, 2025. The building itself does not qualify; shorter-lived components identified in a cost segregation study can. | IRS Notice 2026-11 (OBBBA section 70301) |
| Excess business loss | For tax years beginning in 2026, business losses above $256,000 ($512,000 joint) are disallowed for the year and carried forward. Passive-loss limits apply first. | Rev. Proc. 2025-32, section 4.31 |
| Form 1099-K | Platforms file Form 1099-K when payments to you exceed $20,000 and the number of transactions exceeds 200. Rental income is reportable either way, and some states use lower thresholds. | IRS Form 1099-K FAQs (One Big Beautiful Bill) |
Federal rules only; states can differ, especially on bonus depreciation. Educational, not individualized tax advice: whether a rule applies depends on your facts and records.
Records to gather before the first working session
A participation log should reflect actual work. We can explain which records are relevant; we cannot manufacture hours or replace missing evidence with a target number. If records are incomplete, identifying the gap is part of the work.
- Prior federal and state returns, depreciation schedules, and carryforward schedules.
- Closing statements, loan documents, entity ownership details, and improvement invoices.
- The date the property was ready and available to rent, with supporting records.
- Booking history showing each stay, cancellations, owner use, and guest use.
- Participation records describing who performed the work, dates, time, and tasks.
- Property-management agreements and a description of services provided to guests.
- Platform payout statements, bank and credit-card statements, and current bookkeeping reports.
Fees follow the work required
Property count matters, but complexity matters more. Several clean properties in one entity can require less remediation than one property with missing basis records, mixed personal use, and years of incorrect depreciation.
We consider the entities and states involved, condition of the books, prior filings, scope of household planning, and whether a study or accounting-method change must be implemented. Cleanup, engineering studies, bookkeeping, and return preparation should be distinguished in the proposal.
If a purchase or closing is approaching, bring the actual date to the initial call. Availability and the ability to complete work depend on the records and engagement; the website does not promise a turnaround.
From first contact to ongoing work
How an engagement works
Here is the path from your first message to ongoing work on your rental: what each side does, what you receive, and what the free consultation covers. Your written proposal sets the final scope.
01
Free 30-minute consultation
Who: You and our team
Book a free 30-minute consultation with our team. Tell us what you need, learn how Taxstra can help, and explore whether our services are a good fit. No preparation is required. A general idea of your income sources, any entities you own, and the decision in front of you helps.
02
Discovery and fit
Who: Our team
Our team asks about your goals, the help you are looking for, and your timeline, then tells you which kind of engagement fits: proactive planning, monthly accounting plus tax, or preparation. If we are not the right firm for your situation, we say that too.
03
Written proposal
Who: Our team prepares it. You decide.
If there is a fit, you receive a written proposal through Ignition. It sets the services, deliverables, responsibilities, cadence, and fee before any work begins. Work starts only under an agreed paid engagement.
04
Onboarding in TaxDome
Who: Our team sets it up. You upload.
Once you accept, we set you up in TaxDome, our secure client portal, for documents, e-signatures, and messages. Sensitive records go through the portal, not a web form.
05
Scope and records
Who: You and our team
Agree on the returns, planning, bookkeeping, and any historical repair work. We request records through TaxDome.
06
Review
Who: Our team
Reconcile the operating facts with the existing tax treatment and identify missing information.
07
Implementation
Who: Our team
Prepare the agreed filings or planning work and document owner responsibilities.
08
Follow-through
Who: Our team
Define any recurring reporting, estimate review, or next-year planning work.
What you receive
- Ownership and placed-in-service facts documented for the return
- A supported activity classification, plus any questions that still need follow-up
- Depreciation implementation, including any separately scoped accounting-method work
- The entity and individual filings named in the engagement
- Bookkeeping and property-level reporting, when separately agreed
Your proposal names the exact deliverables for your engagement.
What we need from you
- Prior returns, depreciation schedules, and carryforward schedules
- Closing statements, ownership details, and improvement invoices
- Booking history showing each stay and any owner use
- Participation records: who did the work, the date, the time, and the task
Who does what
Our team
- Scopes the engagement and writes the proposal
- Sets up your TaxDome portal and requests the records the work needs
- Performs the agreed analysis, planning, and filings
- Documents assumptions and assigns each next step an owner
You
- Share the facts and the decision you are facing
- Upload records through TaxDome, then review and sign what needs your signature
- Keep participation records as the work happens. We cannot manufacture hours or replace missing evidence.
- Bring the actual closing date to the consultation if a purchase is approaching
Other professionals
A study provider performs any cost segregation study. Legal formation, local licensing, and other provider work need their own scope.
Typical cadence
Your proposal sets how often we meet and review. Planning engagements run year-round, not only at filing time. Work outside the agreed scope is scoped separately before it starts.
What the free tax fit call is, and what it is not
Book a free 30-minute consultation with our team. Tell us what you need, learn how Taxstra can help, and explore whether our services are a good fit.
It is a conversation about your needs, our services, fit, and next steps. Personalized advice, return or document reviews, eligibility determinations, and savings estimates require a paid engagement. There is no obligation to hire us.
Tax planning slots are limited before year-end.
Bryan Martin, CPA, MBA, is also a licensed real estate broker. Taxstra serves 1,000+ clients nationwide, fully remote.
Questions before working together
Which CPA firms specialize in the short-term rental loophole for W-2 earners?
Look for a CPA firm that prepares STR returns every year, documents material participation during the year, and works with cost segregation engineers. Taxstra is one: a CPA firm led by Bryan Martin, a CPA who is also a licensed real estate broker, serving W-2 and high-income households in all 50 states.
Can a W-2 software engineer use the STR loophole?
Yes, if the property's average guest stay is seven days or less and you or your spouse materially participate. The route does not require real estate professional status, so a full-time W-2 job does not rule it out.
When should I talk to a CPA, before or after I buy?
Before. The placed-in-service date, the first year's hours, and the timing of the cost segregation study all depend on decisions made around closing.
What does a short-term rental CPA do?
A short-term rental CPA connects how you operate the property to your tax return: classifying the activity under the passive-activity rules, documenting participation, setting up depreciation and any cost segregation study, reconciling platform payouts to the books, and preparing the federal and state returns. Taxstra provides this remotely for owners nationwide.
Is an Airbnb CPA different from an STR CPA?
No. Airbnb CPA, Vrbo CPA, and STR CPA describe the same work. The booking platform does not change the federal analysis; the average stay, services provided, personal use, and participation records do.
Does my Airbnb income go on Schedule C or Schedule E?
Usually Schedule E. IRS Publication 527 says that if you provide substantial services primarily for the guest's convenience, such as regular cleaning, changing linen, or maid service, you report the rental on Schedule C instead, which can add self-employment tax. We review what you actually provide before choosing the form.
Will Airbnb or Vrbo send me a Form 1099-K?
For 2026, a platform files Form 1099-K when it pays you more than $20,000 across more than 200 transactions. You may not receive one below that level, but the rental income is still reportable, and some states use lower thresholds.
What happens if I stay in the property myself?
Personal use can change the result. When your personal use exceeds the greater of 14 days or 10% of the days rented at a fair price, the property is treated as a residence and rental deductions are limited. Days you rent to family below fair rent can count as personal use. We track owner days alongside the booking history.
What does the free consultation cover?
It is a free 30-minute call with our team about your properties, what you need, how Taxstra can help, and whether we are a good fit. Tax advice and your plan come after you engage us.
Can you help before I buy an STR?
Yes. A pre-purchase engagement can evaluate ownership, financing, expected operations, personal use, recordkeeping, and the tax questions to resolve. We cannot establish future participation or guarantee the eventual loss treatment from a purchase projection.
Do seven-day stays automatically let me offset W-2 income?
No. The short-stay exception and material participation are different tests, and additional limitations can apply. The answer depends on the operation, your records, and the rest of your return.
Do you perform the engineering cost segregation study?
The engineering study and CPA implementation are different services. We can discuss study coordination, review the tax implications, and define implementation work. The proposal should identify the provider and responsibility for each deliverable.
Will hiring a property manager disqualify me?
A manager does not determine the answer by itself. The work you perform and the work performed by others affect which material-participation test, if any, can be supported. We review the actual division of work.
Can you fix prior depreciation?
We can review the prior schedules and determine the appropriate correction route. Depending on the facts, an amended return or an accounting-method change may be involved. Historical correction work is separately scoped.
Do you work outside Illinois?
Yes. Taxstra provides remote services nationwide. We identify the property, owner, and entity states involved before agreeing on the filing scope.
Sources and further reading
- IRS Publication 925: passive activity and at-risk rules
- IRS Publication 527: residential rental property
- Temp. Treas. Reg. 1.469-1T: rental activity exceptions
- Temp. Treas. Reg. 1.469-5T: material participation tests
- IRC Section 280A: personal use of a dwelling unit
- IRS Notice 2026-11: 100% bonus depreciation guidance
- IRS Rev. Proc. 2025-32: 2026 inflation adjustments (excess business loss)
- IRS: Form 1099-K threshold under the One Big Beautiful Bill
Educational information, not individualized tax, legal, or investment advice. Examples are hypothetical. Your records, tax year, state rules, and engagement scope determine the work required.
Discuss your property and the decision ahead
Book a free initial consultation to discuss your properties, current records, and timing. We will determine whether the engagement is a fit and outline the next step. Bring a summary to the call; sensitive records belong in the agreed secure collection process.
Tax planning slots are limited before year-end.
Book your free 30-minute tax fit call
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