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Can you break even on a ski condo?

djd66

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Joined
Sep 6, 2015
Messages
782
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63
No point in me trying to re-word what VRBO already states on their website better than I could:

View attachment 58629
Strange, I definitely got 1099's and we did not have the $20K in income. Not sure where VRBO is getting the $20K threshold, but my understanding is you have to issue a 1099 if a business pays more than $600 to an individual. One thing I know for sure - if you do not rent out for more than 14 nights you do not have to pay taxes on the income no matter how much you receive.
 

cdskier

Well-known member
Joined
Mar 26, 2015
Messages
6,330
Points
113
Location
NJ
Strange, I definitely got 1099's and we did not have the $20K in income. Not sure where VRBO is getting the $20K threshold, but my understanding is you have to issue a 1099 if a business pays more than $600 to an individual. One thing I know for sure - if you do not rent out for more than 14 nights you do not have to pay taxes on the income no matter how much you receive.

What state do you live in? Some states had defined lower thresholds before the federal government did. The $20K threshold was an IRS guideline for "third party payment processors" (which is what places like AirBnB and VRBO consider themselves acting as on your behalf).
 

djd66

Well-known member
Joined
Sep 6, 2015
Messages
782
Points
63
What state do you live in? Some states had defined lower thresholds before the federal government did. The $20K threshold was an IRS guideline for "third party payment processors" (which is what places like AirBnB and VRBO consider themselves acting as on your behalf).
I live in Mass.

This is right from the IRS website regarding 1099's

File Form 1099-MISC for each person to whom you have paid during the year:
  • At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
  • At least $600 in:
    • Rents.
    • Prizes and awards.
    • Other income payments.
 

cdskier

Well-known member
Joined
Mar 26, 2015
Messages
6,330
Points
113
Location
NJ
I live in Mass.

This is right from the IRS website regarding 1099's

File Form 1099-MISC for each person to whom you have paid during the year:
  • At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
  • At least $600 in:
    • Rents.
    • Prizes and awards.
    • Other income payments.

AirBnB/VRBO don't classify themselves as a rental agency. They consider themselves a 3rd party payment processor. You should be getting a 1099-K from them, not a 1099-MISC. (Although they do give you a 1099-MISC if you had over $600 of other miscellaneous income from AirBnB such as bonuses, rewards, resolution settlement payments, etc).

MA is one of the states with a lower threshold though anyway for 1099-K reporting ($600 is their threshold).
 

x10003q

Active member
Joined
Aug 14, 2009
Messages
911
Points
43
Location
Bergen County, NJ
Jimmy, i'm not sure how short term rentals are good for local economies. Most people who own vacaion area properties and are renting are not from that area. Why would you buy a vacation property where you live. And I would add that in most ski areas around NE the large increase of STR's has crushed the housing market for people who want to live and work at the ski area. The result has been resturaunts and shops closing because there are no workers.
East coast weekend rentals have been around since skiing became popular in the 1950s. The East is big weekend warrior territory and not 7 day rental territory. In ski resort areas, STRs are an absolute must for the local economy. If short term rentals were eliminated across the East, many resorts would go out of business. Lodges/hotels fell out of favor (1960s-1980s) while condos/townhouses became popular. Families wanted more living space and became less inclined to share space with strangers. Ski areas went into the real estate business to make money from RE and drive more business to the resort going forward.

As for local workers, this has always been a problem. Some of the places my skibum buddys were renting in the early 1980s (5 guys in a 1br/1bth basement🤮) were not suitable for my dog. Until the resorts, local gvt and state gvt figure something out, a lack of worker housing at resort areas will continue to be a problem.
 

BodeMiller1

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Joined
Mar 7, 2022
Messages
1,556
Points
63
Location
Barre, VT
^^^ Our tax code is a mess. The whole 1099 push of late assumes people want to comply with tax code. Most people I know want to pay the smallest tax possible. 💲Back in the 90's The U.S. Supreme Court ruled, yes you have the right to limit the taxes you pay. One of the problems is the Federal government is out of wack with the President(s) gaining too much power. It seems like the Court is trying to wittle away the power... A good example is the current administrations campaign promise to forgive student loan debt. Another (although it's Justice not the court) indicting a president.

On the bright side, our government is working as designed. Unless their is a consensus across the board (House, Senate...) then nothing should become law. So we can all be happy that the "pigs on the wing" will get nothing and like it. (not)

How do you like those apples?

Free the Dis

Woof
 

BodeMiller1

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Joined
Mar 7, 2022
Messages
1,556
Points
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Location
Barre, VT
AirBnB/VRBO don't classify themselves as a rental agency. They consider themselves a 3rd party payment processor. You should be getting a 1099-K from them, not a 1099-MISC. (Although they do give you a 1099-MISC if you had over $600 of other miscellaneous income from AirBnB such as bonuses, rewards, resolution settlement payments, etc).

MA is one of the states with a lower threshold though anyway for 1099-K reporting ($600 is their threshold).
When I worked for Freudenberg - NOK if you won a door prize at a company picnic you were 1099'ed. I won a golf bag once and didn't take possession (Already had a WARBIRD). 1099's are great, The I.R.S. just matches them up. There should be a debit and a credit. If the credit is missing it's a red flag. If the debit is missing there's most likely an error. Woof

AirBnBs are a blessing and a curse. Great for the consumer. Not for the hotel, Inn and those kinds of businesses.
 

cdskier

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Joined
Mar 26, 2015
Messages
6,330
Points
113
Location
NJ
East coast weekend rentals have been around since skiing became popular in the 1950s. The East is big weekend warrior territory and not 7 day rental territory. In ski resort areas, STRs are an absolute must for the local economy. If short term rentals were eliminated across the East, many resorts would go out of business. Lodges/hotels fell out of favor (1960s-1980s) while condos/townhouses became popular. Families wanted more living space and became less inclined to share space with strangers. Ski areas went into the real estate business to make money from RE and drive more business to the resort going forward.

As for local workers, this has always been a problem. Some of the places my skibum buddys were renting in the early 1980s (5 guys in a 1br/1bth basement🤮) were not suitable for my dog. Until the resorts, local gvt and state gvt figure something out, a lack of worker housing at resort areas will continue to be a problem.

Yes...if ski areas can own and/or rent condos (as many of them do), then I have zero issue with a private individual doing the same thing through something like AirBnB.

And I know some people don't like to hear this, but it isn't a private property owner's responsibility to provide worker housing. x10003q is 100% right that it is the resorts and local government that need to figure that one out (and local government banning STR is NOT the answer).
 

Hawk

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Joined
Nov 22, 2016
Messages
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Location
Mad River Valley / MA
Again, I wouldn't advocate on banning. Just moving the liability to the individual owners and enforcing penalties for not controling the renters. I couldn't give a rats ass less about if they pay taxes. Not my problem.

And you are wrong about availiblity of affortable housing for people who work. I rented for years as a ski bum. Multiple friends and fanmily members have lived the ski bum life including my nephews and friends kids. Looking at what is availible and prices has been an ongoing thing with us. I have several friends in the realestate industry in the MRV and at Sunday River that have confirmed that Rentals over the past 5 years have been swallowed up by the Air B&B, VBRO craze. There is nothing out there for a person to rent for say 6 months when 5 years ago you could. also the prices have gone up substancially. The other notable trend is that people bought up realestate during the pandemic thinking they could live and work at the hill and now they are trying to get money back through STR's. Realestate people are saying wait another year or two and that bubble will burst and prices will come down to buy. We will see but it makes sence.

Again this is a perspecive thing. If you are a nomad with no real affiliation or need to join a community then price is the most important thing. If you have commited to a ski comunity and live there, then this whole thing just blows. Either way if you rent or stay at your unit, you own the issues. Deal with the asshole renters or dealing with the assholes living there full time. ;-)
 

cdskier

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Mar 26, 2015
Messages
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Location
NJ
I have no issues moving liability to the owners if people renting their units cause problems. I'm fully onboard with that.

But again, the lack of LTR is not the private property owner's problem to solve. If an individual bought a property and can make money renting it out through STR, good for them. There's more risk of issues with STR vs LTR since you constantly have different people renting, but that's the owners that need to be willing to accept that additional risk. STR has always been a thing. AirBnB just made it more profitable compared to the old STR way, so people switched from LTR to STR and I have zero issues with a private owner doing that. Even when I first bought my condo the amount the local real estate agencies took for their "fees" for an STR was absolutely ridiculous. I think the net for a 2-3 day stay ended up being less than 50% of the rental price for units in my complex. It was an absolute joke. So no surprise more people did LTR back then as the fees weren't as bad. With AirBnB the fee they take is peanuts in comparison. Even tack on having to pay someone yourself to clean the unit and you're still way ahead of where you would be with a local real estate agent (and many AirBnB owners just pass on the cleaning fee as well and itemize it out). I don't feel one bit bad for those real estate agencies for losing out on business to AirBnB. They thought they had a monopoly and took advantage of that.
 

2Planker

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Joined
May 16, 2007
Messages
1,423
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MWV, NH
Again, I wouldn't advocate on banning. Just moving the liability to the individual owners and enforcing penalties for not controling the renters. I couldn't give a rats ass less about if they pay taxes. Not my problem.

And you are wrong about availiblity of affortable housing for people who work. I rented for years as a ski bum. Multiple friends and fanmily members have lived the ski bum life including my nephews and friends kids. Looking at what is availible and prices has been an ongoing thing with us. I have several friends in the realestate industry in the MRV and at Sunday River that have confirmed that Rentals over the past 5 years have been swallowed up by the Air B&B, VBRO craze. There is nothing out there for a person to rent for say 6 months when 5 years ago you could. also the prices have gone up substancially. The other notable trend is that people bought up realestate during the pandemic thinking they could live and work at the hill and now they are trying to get money back through STR's. Realestate people are saying wait another year or two and that bubble will burst and prices will come down to buy. We will see but it makes sence.

Again this is a perspecive thing. If you are a nomad with no real affiliation or need to join a community then price is the most important thing. If you have commited to a ski comunity and live there, then this whole thing just blows. Either way if you rent or stay at your unit, you own the issues. Deal with the asshole renters or dealing with the assholes living there full time. ;-)
Now thanks to AirB&B/VRBO one can rent out a house for 1 week at XMas and again Feb vac week and make almost the same $$$ that you used to get for a seasonal rental 4-5 years ago
 
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