My client is an artist and has had a schedule C for many years. The last few years it's been a loss. A few years ago he began renting large warehouses and fixing them up for spaces for artists to rent. This has really worked for him. When does a rental business become a schedule C. The difference here is he is renting and renting to others. His artist business is not making a profit. His rental business is. When do I have to change the Schedule E to a Schedule C? Is it ever required? I don't know where to look this up. Suggestions on where to find more information on this helps.
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Here are a couple of sources
http://www.irs.gov/publications/p527...link1000219116
http://www.ehow.com/facts_7364101_sc...al-income.html -
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they are all Sch E from the beginning unless he is providing services to the rental areas.Believe nothing you have not personally researched and verified.Comment
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Or, short term rentals. Does an artist rent for 7 days or less, to finish a messy project, for instance? If monthly or longer leases and no substantial services and renting a defined space or sharing rent on the whole studio, then it's Sch E.
If just renting easel space, like a hair salon renting a chair, then it might be Schedule C. Facts & circumstances!Comment
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