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You can be considered to have sold all or part of your property even though you did not actually sell it.  This may occur when you change all or part of your principal residence to a rental or business operation or you change your rental or business operation to a principal residence.  Note that every time you change the use of a property, you are considered to have sold the property at its fair market value and have immediately reacquired the property for the same amount.  Therefore, you have to report the resulting capital gain or loss in the year the...
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A corporation must meet certain requirements in order to be eligible for the small business deduction.  Specifically, the small business deduction cannot be claimed by a corporation that carries on a specified investment business.  A corporation’s business is considered a specified investment business if the principal purpose of the business is to earn income such as interest, dividends, rents and royalties from property.  One exception to this rule is if the corporation employs more than 5 full-time employees in that business throughout the year.  Generally, the business of a campground involves the renting of property and providing basic services typical of...
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The following are special situations when the costs you incur from earning rental income are considered capital expenses: 1.    Modifications to rental properties to accommodate persons with disabilities.  You may renovate your existing rental property to accommodate persons with disabilities.  You can deduct outlays and expenses you have for eligible disability-related modifications in the year you paid them, instead of having to add them to the capital cost of your building. These modifications include installing hand-activated electric door openers, installing interior and exterior ramps and modifying a bathroom, elevator or doorway so a person with disabilities can use it. You can...
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If you own rental properties, you can generally deduct any reasonable expenses incurred from earning rental income.  There are 2 basic types of expenses: 1.    Current Expenses:  These are recurring expenses that provide short-tern benefits such as the cost or repairs to keep a rental property in the same condition as it was when you acquired it.  You can deduct current expenses from your grow rental income in the year you incur them. 2.    Capital Expenses:  These are expenses that provide a benefit that usually lasts for several years such as costs to buy or improve your property.  Generally, you can...
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