At a glance
- The limit is not 14 days. It is the greater of 14 days or 10% of the days you rented at a fair rental, so a property rented 250 days gets 25 personal nights, not 14.
- Three different rules get called “the 14-day rule.” The personal use limit, the Augusta Rule and the seven-day average stay test are separate provisions doing separate jobs.
- One night over caps your deductions at your rental income. No loss, and a cost segregation study you paid for sits stranded.
- Repair days are free. A day worked substantially full time on repairs is not personal use, even if your family was there.
The 14-day rule is the most misquoted number in short-term rental tax. Part of the problem is that there are three of them — in different places in the Code, each deciding something different.
This page separates them, sets out how personal use days are actually counted, and shows what crossing the line costs on a real return. It is more than most people expect — considerably more.
Three rules, one number
| What people call it | What it actually is | What it decides |
|---|---|---|
| The 14-day rule | Personal use limit. Greater of 14 days or 10% of days rented at a fair rental. Section 280A(d)(1) | Whether the property counts as your residence, which caps your deductions |
| The 14-day rule | The Augusta Rule. Rent the place out for less than 15 days in the year. Section 280A(g) | The rent is excluded from income entirely, and no rental deductions are allowed |
| The 14-day rule (this one is wrong) |
The seven-day average stay test. Regulation section 1.469-1T(e)(3)(ii)(A) | Whether the activity is passive at all. This is the short-term rental strategy |
They interact — but they do not overlap. You can pass the seven-day test, materially participate, commission a study, and still lose the deduction to the personal use limit. That is the failure this page is about.
How the personal use limit is actually counted
Section 280A(d)(1) makes a dwelling your residence if personal use exceeds “the greater of 14 days, or 10 percent of the number of days during such year for which such unit is rented at a fair rental.”
Two things follow. The limit rises with how much you rent, so a heavily booked property is more forgiving than a lightly booked one. And it is measured against fair rental days, not against days the place was available.
| The day was | Fair rental day | Personal use day |
|---|---|---|
| Rented to a paying guest at a market rate | Yes | No |
| Rented below a fair rental price | No | Yes |
| Vacant, listed, nobody booked | No | No |
| Used by you, or any co-owner | No | Yes |
| Used by a sibling, parent, child, grandchild or spouse | No | Yes, unless it is their main home at a fair rent |
| Swapped with another owner’s property | No | Yes |
| Spent working substantially full time on repairs | No | No, even if family were present |
The vacant row is the one that surprises people — and it costs them. A property listed all year and booked 120 nights has 120 fair rental days, not 365, so the 10% figure is 12, and the limit is the greater of that and 14 days. Days on the market do not buy you personal nights.
“Family” here is narrower than it sounds — usefully so. Section 267(c)(4) means “his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants.” Cousins, nieces, nephews, aunts, uncles and in-laws are not on that list, so a week for your brother is personal use and a week for your brother-in-law, at a fair rent, is not.
What crossing the line costs
If you read nothing else, read this. Five nights, and a six-figure deduction.
A short-term rental, rented 200 days at a fair rental, with a cost segregation study producing a large first-year deduction. Same property, same study, two different holiday plans. Figures are illustrative and rounded.
| On the return | 15 personal nights | 25 personal nights |
|---|---|---|
| Days rented at a fair rental | 200 | 200 |
| The limit: greater of 14 days or 10% of 200 | 20 | 20 |
| Personal nights taken | 15 | 25 |
| A residence under section 280A(d)(1)? | No | Yes |
| Gross rental income | $90,000 | $90,000 |
| Deductions otherwise allowable | $210,000 | $210,000 |
| Deductions actually allowed | $210,000 | Capped at $90,000 |
| Loss available this year | ($120,000) | $0 |
Five nights turned a $120,000 loss into nothing, roughly $42,000 of tax at a 35% marginal rate. Section 280A(c)(5) caps deductions on a residence at the gross income from the rental use, so the study is not lost but it is deferred, carrying forward under the same limitation until the property stops being a residence.
The one-line version. Count your nights before you book them. The cheapest tax planning available on a short-term rental is a calendar. Figures are illustrative.
Section 280A(e)(1) adds a second layer even below the limit: expenses are allocated in the ratio the fair rental days bear to total days used. Personal nights reduce the deductible share of every mixed expense whether or not you cross into residence status.
The Augusta Rule is a different provision
Section 280A(g) says that where a dwelling used as a residence is rented for less than 15 days in the year, the rent is not included in income and no deductions are allowed for the rental. It is the rule behind renting your own home to your own business for a board meeting or an event week.
It is the opposite situation from the one above — exactly inverted. There, you are running a rental and trying to keep personal use down. Here, the property is your home and the rental is the brief exception. The two cannot both apply to the same property in the same year in any useful way, and confusing them is how people end up excluding income they should have reported.
The seven-day test is not a 14-day rule at all
What makes a short-term rental non-passive is a different provision entirely. Regulation section 1.469-1T(e)(3)(ii)(A) removes an activity from the definition of a rental where “the average period of customer use for such property is seven days or less.” Paragraph (B) does the same at 30 days or less where significant personal services are provided.
Fall outside the rental definition and the automatic passive treatment in section 469(c)(2) does not apply, so ordinary material participation decides the answer and no real estate professional status is needed. That is the whole of the short-term rental strategy, and we set out the participation side in the 100-hour rule and the wider case in the STR strategy.
Note which number is which — it matters. Seven days is the average stay of your guests. Fourteen days is your own nights in the property. They are unrelated measurements and a property can pass one and fail the other.
What to do about it
- Work out your own limit before the year starts. Take last year’s fair rental days, take 10%, compare it to 14, and use the larger. That is your budget.
- Book your own stays last. The limit depends on how much you rent, so committing personal nights in January against an unknown rental year is how people go over.
- Keep the booking record, not a memory. Fair rental days come off the platform. Personal nights have to be logged by you, and the Schedule E line asks for both.
- Do the repair days properly. Substantially full time on the work, documented with invoices and photographs. A morning of touch-ups before a family weekend is not a repair day — it is a holiday with a screwdriver.
- Sequence the study around the calendar. Commissioning a cost segregation study in a year you also plan three weeks in the property is how a deduction gets deferred for nothing.
Frequently asked questions
What is the 14-day rule for rental property?
In its most common sense it is the personal use limit in section 280A(d)(1): a dwelling becomes your residence if you use it personally for more than “the greater of 14 days, or 10 percent of the number of days” it was rented at a fair rental. Once it is a residence, deductions attributable to the rental use are capped at the gross income from that use. Two other provisions also get called the 14-day rule: the Augusta Rule in section 280A(g), and, wrongly, the seven-day average stay test that makes a short-term rental non-passive.
How many days can I use my rental property personally?
The greater of 14 days or 10% of the days it was rented at a fair rental. Rented 100 days, the limit is 14. Rented 200 days, it is 20. Rented 300 days, it is 30. Vacant days count for nothing in that calculation, so a property that sat listed and empty for months does not earn you extra personal nights. Stay at or below the figure and the property is not a residence; go one night over and it is.
What happens if I use my rental property more than 14 days?
Nothing, if you are still under 10% of your fair rental days. If you are over the applicable limit, the unit is a residence and section 280A(c)(5) caps rental deductions at the gross income from the rental use, so the activity cannot produce a loss. Disallowed amounts carry forward to the following year subject to the same cap. For an owner relying on a cost segregation study to shelter other income, that is the difference between a six-figure deduction and none.
What are fair rental days on Schedule E?
Days the property was actually rented at a fair rental value. The Schedule E instructions ask you to “report the number of days in the year each property was rented at fair rental value.” Days the property was vacant, listed, between guests or being repaired are not fair rental days, and neither is a stay by someone paying less than market rate. The figure matters beyond the form, because the 10% half of the personal use limit is calculated from it.
Do repair days count as personal use?
No, where you are working substantially full time on repairs and maintenance. The exclusion holds “even if family members were also present,” so a spouse reading on the porch does not undo a day you spent replacing a deck. What it does not cover is a short job attached to a holiday. Document it the way you would document anything else that saves tax: dated invoices, receipts for materials, photographs, and a note of the hours.
Does letting family stay count against me?
Usually yes. A day the unit is used by anyone in your family counts as personal use unless it is rented to them at a fair rental price as their main home. Family is defined by section 267(c)(4) as “his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants,” which is narrower than most people assume. Cousins, nieces, nephews, aunts, uncles and in-laws fall outside it, so a week for them at a fair rent is a rental week rather than a personal one.
Is the 14-day personal use limit the same as the Augusta Rule?
No. The Augusta Rule is section 280A(g): rent out a dwelling used as a residence for less than 15 days in the year and the rent is excluded from income, with no rental deductions allowed. The personal use limit is section 280A(d)(1) and measures your own nights against your rental days. One is about how little you rent, the other about how much you use. They answer different questions and the number they share is a coincidence of drafting.
Is there a seven-day rule for rental property?
Yes, and it is the one that matters most for short-term rental planning. Regulation section 1.469-1T(e)(3)(ii)(A) takes an activity outside the definition of a rental where “the average period of customer use for such property is seven days or less,” which removes the automatic passive treatment and lets material participation decide. A 30-day version applies where significant personal services are provided. It is measured on your guests’ average stay, not on your own use, and it is entirely separate from the 14-day personal use limit.
Related reading
- Material participation for short-term rentals. The 100-hour test.
- The short-term rental strategy. How the loss reaches W-2 income.
- Cost segregation for Airbnb. The deduction the calendar can strand.
- Cost segregation: what it costs. Whether a study is worth commissioning.
- Schedule C or Schedule E. Where the income actually goes.
- Converting your home to a rental. Basis, use and the first year.
- Active or material participation. Two tests, two outcomes.
- Real estate professional status. The route that needs 750 hours.
- Deductions for real estate investors. The 2026 list.
- Short-term rental tax services. What we do and what it costs.
Schedule a call
A short conversation about your situation, our read on it, and whether it is a mutual fit. If you own a short-term rental you also use, we can work out your actual personal use budget for the year before you book anything.
General information, not advice for your situation. Figures are illustrative. Sources: IRC section 280A, section 267, Regulation section 1.469-1T, IRS Publication 527 and the Instructions for Schedule E.
