Will the strategy of 10xbnb co-listing help me save taxes on my w2 using the STR loophole ?

[Prashanth31]

Hello dear hosts

     I want to become an Airbnb host. I have a long -term rental home. But according to various tax strategy CPAs and YouTubers , like Tax alchemy etc. , it is a good idea for me to invest in a short term rental option like Airbnb so that I can write-off and save more on taxes that I owe from my regular job as a physician.  I could potentially go to Zillow.com across usa and search for a studio apartment in any of the safe downtown or upscale neighborhoods and do some background search , buy it and put it up for Airbnb. But , that will take more money apparently compared to something called “airbnb co-listing” , where you search for landlords that have long-term homes that are vacant and not finding renters.  Any experience in this ? Will this form of Airbnb still qualify me for the STR loophole when I file taxes.  I know I want to have just 1 Airbnb. But I need advice on single ownership listing or the “10xbnb.com” style of co-listing.  Please advise. 

[Helen3]

@Prashanth31 

1. You need to speak to an accountant about tax issues . Please don't rely on YouTube for tax advice.

2. you are talking about arbitrage where you sub let for short term rentals . Again you would need to speak to your accountant about tax implications 

3. where I live in the UK standard tenancy leases forbid subletting so arbitrage vis not a common model

You would need to do your market research to see if landlords in your country are open to this model

have you thought about how you will cover costs if you don't generate the bookings you need ?

[Prashanth31]

Shaun Ghavami  just one example. https://youtube.com/shorts/KemLdFcK8gM?si=6TZfJNtxm2TpYU81

It seems like it won’t be a subletting.  It’s basically co-hosting without actually owning or purchasing any property. Just helping out with finding clients for the Airbnb and taking 20% of the returns. That way the landlord is happy that his house is not vacant while he keeps waiting for a long term renter.    

I think that will be a lot of work. But worth exploring.   USA does allow sublease , not generalizing , but case by case basis yes.  

by the way. Is there a thread of posts that talks about how do I even start searching for which neighborhood in which city will be a good idea for me to look at buying a small studio apartment that I can potentially list on Airbnb ? And can I reach out to an existing host to co-manage with me until I get good reviews. And then I can be on my own. 

[Lorina14]

@Prashanth31 

You may want to look into AirDNA and Pricelabs as they have some tools that you may be looking for to determine what markets are good to invest in.

To become a cohost, you could contact owners directly to see if they wanted help managing their listings (you should have some general experience to offer) or maybe you have a friend who has an Airbnb that you could cohost for actively or only when they go on vacations. Another option is to apply to be a cohost through Airbnb but they cap the number of cohosts in certain areas (this is for being listed on Airbnb as a cohost for an area, you could become a cohost for a host who agrees to have you as a cohost).

You will need to look into how much to charge; a 10-20% of the booking rate is what I have read in these boards is standard and what that entails (messaging guests with inquiries or issues, cleaning the unit, coordinating the cleaning, doing market research, promoting the listing, etc. it can vary widely depending on your contract and agreement with the host).

[Prashanth31]

Excellent thanks a lot. Yes I joined a couple of co-host communities in my area and I am going to learn the first steps of Airbnb hosting by first trying out as co-host before buying a unit and becoming a single host.    

[Lorina14]

@Prashanth31 (if you use the @name of person, it will flag them that someone mentioned them).

Sometimes people buy a listing and hire someone to set it up for them. This can vary from writing a listing, writing a guidebook, taking pictures or standing for a photographer to take pictures, and/or suggesting all furnishings and decor.

Sometimes the people stay on as cohosts or they are one off pay for a service transactions.

If you are not local to your listing, you need to have a good cohost/property manager or handyman, cleaners, etc. to rely upon. You can private message me if you have any other questions. 

[Helen3 · Accepted solution]

Oh okay in your first post you said  @Prashanth31 

'called “airbnb co-listing” , where you search for landlords that have long-term homes that are vacant'. 

that is not cohosting it's arbitrage . 

@Lorina14  He wouldn't be able to apply to become a cohost through Airbnb - to be eligible you have to have great reviews and ratings as a host . 

you can certainly pay an experienced host to act as a cohost for a listing that you have. @Prashanth31 

[Lorina14]

@Helen3 

That is interesting as I have seen people who are cohosts who do not have a listing as a primary host but only cohost with other hosts. Unless you are talking about getting on Airbnb’s cohost list where they promote you to other hosts as someone who can help you as a cohost. You have to apply for it and I guess they would review your application and let you know if you qualify. I qualify to be a cohost but am on a waitlist for my area. There appears to be a lot of people who are professional cohosts or own property management companies who cohost.

[Prashanth31]

Lots of learning points , both of you so helpful. Indeed a pleasure to be in this community. I need to do a lot of learning. This is a great start. 

[Helen3]

Yes as I said I am referring to those on the Airbnb co host list. I applied and was approved last year .

You were able to apply because you are already a host and have got good ratings and reviews .

@Prashanth31 would not be able to apply because he had no experience as a host .

[Elisa]

Hi @Prashanth31  😊, 

Thank you for bringing up this topic in the Community Center!

I truly understand your point. Did you decide what to do? 

I'm happy you’ve found many hosts to discuss this with! 😍
Would you mind marking the 'Top Answer' if you found one particularly useful?

Just a tip 👉 when replying to hosts, don’t forget to tag them using @ and their name so they’ll notice your response!

Don’t hesitate to keep us posted!

Warm regards, 🌻

[Prashanth31]

@Helen3  @Lorina14  @Elisa    All of you have been giving excellent inputs.  I will continue to join Facebook groups for hosts and co-hosts within my local area. And start interacting with hosts. Learn more and more for about 3-4 months. And then decide whether I can take a leap of faith and invest in a small unit. 

on that note , my 2 main aims are :

1. Make use of the STR loophole or advantage where I can deduct expenses and write-off taxes against my w2. 
2. Enjoy the experience of hosting a short term rental since I already have a long term rental experience with 1 unit. 

I would like to request answers from people from USA who are co-hosts and from people in USA who are actual owner of units.  Are you able to write off taxes based on expenses > greater than your STR Airbnb / co-hosting income in such a way that it helps you reduce your total taxable income (especially if you also have a day job with a w2). 
for example. If my total family has a w2 salary of 260k per year , and I become a  and if my income from co-hosting is 30k $ per year vs 60k $ from owning a unit as a single main host , how much max expenses do you get to write off ? Has this journey helped anyone here to reduce w2 taxable income ? I know many of you maybe full time 1099s. 

[Elisa]

Hi @Prashanth31 😊, 

Thank you for letting me know!

I’m sharing the link to the 👉 Local Host Clubs, where you’ll be able to connect with hosts from the USA and ask your questions.

Let me know how it goes!

Warm regards 🌻

[Helen3]

This is something you should talk to your accountant about about @Prashanth31 

I can't see why any tax system would allow you to  write off more tax than the income you generate .