Steve Pope wrote:

- quote -

From what I've heard of the state of the houses following shows
like that, I'd tend to agree. Building a house from the ground
up in 7 days is not a recipe for success, and $50k wouldn't
necessarily be enough to fix the problems.

Phoebe

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

"Steve Pope" <spope33[at]speedymail.org> wrote:
- quote -

but it is not the owner who is creating the entertainment.
The show's producers are renting the property, and the
show's producers are using that rental, plus movie camera,
etc., etc., to create the entertainment. The so called
entertainment.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Drew Edmundson <drewsbeagles[at]hotmail.com> wrote:
- quote -

If the tenant is going to tear down the house, I think that
$50,000 would be reasonable rent.

It seems to me that the problem (if there is one) would be
with the "less than 15 days" provision. While it doesn't
explicitly say so, section 280A(g) basically says that
rentals of under 15 days are not to be treated as rentals at
all, but treated as if it didn't happen.

If the entire transaction is not recognized for tax
purposes, then the exclusion under section 109 might not be
allowed.

Stu

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

"123go" <rejecto[at]rejcet.ccc> wrote:

- quote -

The problem is that the improvements are not done in lieu of
rent, but in addition, so they're not excluded on that
basis. They might be excluded under section 109, but only
if the show's use of the show's use of the property is
actually condidered renting.

Stu

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

"Herb Smith" <smithff33[at]aol.com> wrote:
- quote -

Thanks, guys, I found it - section 280A(g).

Stu

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

William Brenner <wbrenner[at]nospamplease.net> wrote:
- quote -

Interesting from the standpoint that, when structured this
way there's no taxable income at all to the property owner.
The "rent" is not included because it's for less than 15
days. And the property improvements are not included under
section 109.

Too bad Oprah hadn't thought of THAT one!

Stu

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford at lunstax[at]belllsouth.net wrote:

<snip> Newsweek in May 2004 reported that the tv show signed 10 day contracts
- quote -

Rent less than 14 days is not reportable. I wonder how the
company will report this? If they issue a 1099MISC, the
landlord will have a tough time explaining it.

All freely provided advice guarantee correct or double your
money back

Frank S. Duke, Jr. CPA
Cincinnati, OH USA

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

David Woods <davidwoods[at]verizon.net> wrote:

- quote -

Perhaps, but the intent of the "improvements" is not to compensate
the landlord in lieu of rent, but to create entertainment.
There's enough of a substantive difference that the IRS could
decide to treat it in a different way -- if it's on their radar
and they get around to it. Clearly you can't use the 15 day
rule to disguise all manner of compensation as tax-free rent.

But personally, I would view it as damage to my house rather than
improvements.

Steve

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

"Harlan Lunsford" <lunstax[at]belllsouth.net> wrote:

- quote -

per PUB 527, sounds like rental income which is not reportable:

"Property or services. If you receive property or services, instead of
money, as rent, include the fair market value of the property or services
method. in your rental income. If the services are provided at an agreed
rental income or specified price, that price is the fair market value unless
there is evidence to the contrary. Example. Your tenant is a painter. He
offers to paint your rental property instead of paying months' rent. You
accept his offer. Include in your rental income the amount the tenant would
have paid for 2 months' rent."

... . .

"If you rent it fewer than 15 days during the tax year, do not include the
rent you receive as rent in your income and do not deduct rental expenses."


what else COULD it be? It is not a gift.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

"Stuart A. Bronstein" <spamtrap[at]lexregia.com> wrote:
- quote -

Used to be??

- quote -

I don't see a problem with this. The "lease" is under 15 days.
The rent is paid for by improvements. Plenty of precedent to
support the concept.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Stuart A. Bronstein wrote:
- quote -

Interesting answer per IRS Pub 527:
"Rental of property also used as a home. If you rent property
that you also use as your home and you rent it fewer than 15
days during the tax year, do not include the rent you receive
in your income and do not deduct rental expenses..."

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford <lunstax[at]belllsouth.net> wrote:

- quote -

I'd use the guidelines that apply to in-home daycare: it
amounts to letting children into your home who then leave
their toys behind.

Steve

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford <lunstax[at]belllsouth.net> wrote:

- quote -

My first thought is the amount in excess of fair market rent
is taxable as ordinary income.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford <lunstax[at]belllsouth.net> wrote:

- quote -

To start with I would ask what a fair market rental is for
10 days on his house. The excess would seem to be something
else (e.g. a prize).

Reality TV World has an article about it here:

http://www.realitytvworld.com/index/...ory.php?s=2552

I got the url form a long thread on the ABA-Tax listserve
from last fall. You can search it at:

http://mail.abanet.org/archives/aba-tax.html

Just type in extreme makeover. I don't recall a consensus
being reached.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Stuart A. Bronstein wrote:
- quote -

The provision still exists. See Pub 527, the rent is tax free
income.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford <lunstax[at]belllsouth.net> wrote:

- quote -

I watch bull riding, drink homebrew, know the words to
"Backsliders Wine", and could pick David Alan Coe out of
a lineup. No way I would drop my standards so low as to
watch reality TV.

But there are two things I know of value here. First is
that the value of leasehold improvements is not taxable to
the property owner at the end of a lease. And the second
is that Congresscritters wrote a tax exemption into law for
the benefit of people living near military academies in
particular and universities in general. Turns out it also
benefits residents of Cooperstown, New York, Canton, Ohio,
and other places. They set a time threshold to be met
before rent is taxable. It may be 14 days.

Looks like non-taxable events to me.

Dick

<< ================================================== ===== > << You may use the above information for any reason you > << choose as long as you do not mention my name in your > << confession or at either your hearing or your trial. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Harlan Lunsford <lunstax[at]belllsouth.net> wrote:

- quote -

As I recall, there used to be a provision that if you rented out
your home for no more than 14 days in a tax year, all the rental
income received was tax free. Does anybody remember that?

- quote -

Not just renovating, but sometimes tearing the house down and
building a whole new and much better (often much larger) one.

- quote -

Interesting question.

Stu

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

Put your thinking caps on now. "Your" client arrives and reports he
received 50,000$. You ask, when, why, and how. When, this year of
course, and he wants to know how it will affect his tax return for 2005.

Why? Because he was the lucky contestant on ABC's Extreme Makerover
Home Edition and they paid him this 50,000$ so that they could come in
and renovate and refurbish the house for the tv show.

Newsweek in May 2004 reported that the tv show signed 10 day contracts
with the families to "lease" their properties for a fee of $50,000
and then claimed that any imporvements left behind were "rent" and as
such, should not be taxed.

I've not seen the show, so don't know if the activites include just
renovating the real estate or also include leaving behind some personal
property as well.

So now, how do you view it and what advice to give to client assuming
personal property IS involved, AND that the actual time is less than
14 days on site.

Evil ChEAr$!
Harlan Lunsford, EA n LA

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >