STR Tax Deductions for 2025: Short-term rental tax loopholes. Keep more. Stress Less.

Let me start with a confession about rental property tax codes. I once believed all rental expenses were tax-deductible.

That misconception led to a tax season meltdown when I tried deducting personal upgrades, including a fancy espresso machine for my Airbnb.

Here’s the reality: the IRS doesn’t care about your guests’ coffee preferences. They care about legitimate business expenses.

What Qualifies as Deductible?

Unlike long-term rentals, short-term rentals (STRs) allow you to deduct operational costs that maintain your property’s guest-ready status. These include cleaning fees, toiletries, and linen services.

However, 2025 brings crucial changes to these deductions.

The IRS is reducing bonus depreciation to 40%, down from 100% in 2023. This change demands immediate attention for property owners considering cost segregation studies or upgrades.

Understanding Depreciation Differences

Long-term rentals require property depreciation over 27.5 years. STRs offer accelerated deductions through asse…