Pocket Some Tax-Free Cash with Airbnb!
Generally speaking, every dollar you ever earn will be subject to taxes. You get taxed on your wages, any interest you earn, any earnings from providing home daycare, and even selling things in a yard or garage sale can result in a tax.
The internet has brought on a communication revolution and with it comes new opportunities to make money. Early on, in September of 1995, eBay was founded. This website alone showed the world that individuals could buy and sell products just like department stores. Since then, the speed of the internet and websites have only increased. Money making opportunities are a click away to anybody willing to give it a try. With these sales of course, comes taxes.
On the other hand, the IRS does give us a break. In IRS Publication 527, a small (before now) rarely used clause exists which reads, “If you use a dwelling unit as a home and rent it 15 days or more during the year, include all your rental income in your income. “
Simply put, if you utilize a service such as Airbnb or VRBO to rent a room or a house for less than 15 days in a tax year, you get federal tax free income. The glory of this situation is that this tax free income now not only applies to people with a vacation property, it applies to the average person with a room to rent.