Short-term rental "loophole" in southern Utah — still worth it?

moab_mike · 10/14/2025

Material participation rules plus a cost segregation study is the whole play, and it only works if you genuinely run the property. Between St. George market saturation and city permitting, I am not sure the tax tail should wag this dog anymore.

6 replies

It is not a loophole, it is an exception to the passive rules. Average stay 7 days or less and you materially participate. Keep a contemporaneous log or you have nothing.
TaxGuyTom · 10/15/2025
Log as in a spreadsheet? Or something fancier?
moab_mike · 10/15/2025
Spreadsheet is fine if it is written as you go, with dates, hours and what you did. Reconstructed at exam time is worthless.
TaxGuyTom · 10/15/2025
Also check the city. Some southern Utah towns got a lot less friendly about nightly rentals in the last two years.
mtn_bike_mom · 10/16/2025
cost seg + STR is still the best deal in the code and nobody can convince me otherwise
YoloOnIndexFunds · 10/20/2025
Until you sell and the recapture shows up. Great deal, just not a free one.
jenn_from_provo · 10/20/2025