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Posts Tagged ‘rental managers Sun Valley’

How To Avoid IRS Compliance Traps

Thursday, June 12th, 2014

With all sources of income, taxes are an important consideration. Income from your vacation rentals is no exception. With vacation rentals, there are 3 key tax considerations.

1. Personal Use and Rental Days

The number of days you personally use your vacation rental property has a significant impact on how the IRS treats your rental income:

a. If personal use is limited to 14 or fewer days or 10% of the time your property is rented, you can write-off 100% of rental expenses against rental income.

b. If personal use exceeds 14 days, you can still write-off a portion of your rental expenses against rental income. For example, if you rented your property for 90 days and had 30 days of personal use during the year, you are allowed to write-off 75% (90 rental days/120 total usage) of your rental expenses against rental income.

c. If you rent your property for 14 days or less, you are not required to report the rental income for income tax purpose.

2. Common Rental Expenses
The following is a list of common rental expenses that may be written-off against rental income:

* Management Fees
* Mortgage Interest
* Mortgage Points
* Repairs
* Taxes
* Utilities
* Advertising
* Cleaning & Maintenance
* Commissions
* Depreciation
* Insurance
* Legal/Professional Fees

3. Passive vs Active Income
The IRS usually considers income from rental real estate to be a passive activity; that is, you get income mainly for the use of your property rather than for services provided. The IRS allows you to off-set passive losses against passive income, not ordinary income such as wages. Any excess passive losses are carried forward to the next tax year.

If you are actively involved in the rental of your vacation home, up to $25,000 of the loss from your rental property could be deductible against ordinary income. There are restrictions and limitations if you make more than $100,000 annually.

At VRS we recognize that keeping more of your rental income is one thing all vacation homeowner have in common. That is why we provide essential rental management services as an affordable fixed monthly price. Compliance Services are just $50 per month.

Fraud and Your Vacation Rental Property

Thursday, May 15th, 2014

In addition to attracting the attention of millions of travelers, the $23 billion vacation rental industry is unfortunately attracting a variety of scams. One need only perform a Google search to find story after story of how both travelers and vacation homeowners are becoming victims of fraud and phishing schemes. This is a trend that will no doubt continue to plague the industry. But what steps can you take to protect yourself and your guests from the impact of these scams?

  • We will take a look at the two most common scams:
  • •   Creation of Fake Rental Listings
    •   Phishing Schemes

  • Creation of Fake Rental Listing
  • In this scam fake rental listings are created to attract legitimate travelers. These listings are often created using pictures and information taken from legitimate listings. The unsuspecting traveler typically learns that they have been the victims of fraud only after they have paid out thousands of dollars for the rental.

    You can expect that as these stories are picked-up by national news sources, travelers will become increasing concerned and will no doubt make inquiries designed to assess the authenticity of your listing. Recent articles by ABC News and Forbes, among many others, suggest that travelers take a series of precautions to avoid fraud. The below chart reflects some recurring recommendations and steps you can take to ensure you are prepared to address traveler questions.


    Google offer a search service called Google Images that allows users to search the Web for image content. VRS recommends that you periodically search Google Images to determine if your property photos are being used for unauthorized purpose. To perform a search, simply copy the image address into Google Images and perform a search.

  • Phishing Scam
  • In a Phishing scam, someone masquerading as a legitimate guest contacts you, with the sole objective of obtaining sensitive information about your VRBO listing and/or the email address you use to manage your vacation rentals. Typically they want to obtain access to your email, which will allow them to hijack your rental inquiries and redirect rental deposits to themselves.

    Here are some steps that you can take to avoid being the victim of Phishing scams.
    •   Be suspicious of unusual rental inquiries. Vague travel dates, grammar or spelling errors, or requests that are inconsistent with your property can all be signs of a phishing scams
    •   Use a dedicated email address to manage your rentals. As much as we try, it is difficult to create a firewall around our personal email account.
    •   Subscribe to VRBO text notifications service. By receiving a text notification of all rental inquiries you can be sure that you are aware of all such inquiries.
    •   Use best practices to manage your email and VRBO passwords. This consists of longer passwords (minimum of 8 characters), do not use words, use a combination of numbers, upper and lower case letters, and use special characters. Periodically change your password.

    VRS is dedicated to providing safe and secure rental management services that highlights your property’s unique rental characteristics. Our ala carte menu of services are provided at a low fixed monthly fee.

    Rental Inquiry Response Time Study

    Thursday, January 30th, 2014

    Promptly responding to rental inquiries is critically important to converting rental inquiries into rental bookings. Most vacation homeowners and Rental Managers (RMs) believe they respond promptly to all rental inquiries – but what really happens? VRS commissioned a study to determine exactly that; “How promptly do both typical owner-operated and RMs respond to rental inquiries?”

    The average response time in the study was 8.73 hours. Less than 25% of the responses were within the ”golden” 1-hour window, the period of time regarded as most valuable to convert rental inquiries into rental income (and of course, what impression your prospective guests will have of their future experience). Surprisingly, nearly 1/3 of inquiries received no response! Not only is the initial response time important, it is obviously important to follow-up with the prospective guest. In this study, less than 5% of inquiries received a follow-up email beyond the initial email. In a time when every rental inquiry is an opportunity to generate rental income, every inquiry should be coveted.

    There was a large disparity between responses from RMs and Owner-managed properties. RMs either responded promptly or did not at all. 38% of RMs responded within 1 hour, while an equally large group (36%) of RM’s sent no response, and unbelievably, only 2% of RMs sent a follow-up email. One clear difference from RM and Owner-managed responses: RM responses typically included an invitation to view other similar properties they manage

    The results of this study overwhelmingly indicate that; low time-to-response, persistence in follow-up and focus on renting only your property rather than a “rental pool” are basic requirements to successfully differentiating your property from the competition and increasing rental revenues.

    This much is very clear: to the extent potential rental guests typically book vacation properties that meet their requirements and responses are promptly and professionally managed, higher conversion rates and rental income should predictably follow.

    Rapid Response is a core business practice at VRS. Our focus on connecting rental customers and owners “one-on-one” through technology infrastructure and lead management operating systems facilitate rental inquiry responses within 30 minutes. Rapid Response results in significantly higher inquiry conversion rates and rental income for our customers. VRS passes along the savings we’ve created in our business model to our customers, resulting in up to 65% increases in net rental income. VRS provides complementary rental income comparison audits upon request. VRS Rental Management Plans under our low fixed monthly fixed-fee program are just $130.00 per month for a 2-bedroom property.

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    If you could keep as much as 65% more rental income without sacrificing on service - why wouldn’t you?

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