The 14-Day Home Rental Rule for Business Owners
How Section 280A(g) lets you rent your home to your company for short meetings tax-free, and the documentation that decides whether it survives.
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
Under Section 280A(g), if you rent out your home for 14 or fewer days in a year, the rental income is excluded from your taxable income. Owners of corporations and partnerships can rent their home to the business for meetings: the business deducts fair rent; the owner receives it tax-free. It needs real business use, market rent, and records.
On this page
How does it work?
- The business holds a genuine business event at your home — a board meeting, strategy session, or staff training.
- It pays you rent comparable to what a local venue would charge for the same space and services.
- The business deducts the rent as an ordinary expense.
- Because you rented the home for 14 or fewer days that year in total, you exclude the rent from income and deduct no rental expenses (mortgage interest and property taxes stay on Schedule A as usual).
The provision is nicknamed the "Augusta rule" after homeowners near the Augusta golf tournament who rent their houses for a week each year.
Who can use it?
| Business structure | Can rent from the owner? |
|---|---|
| S corporation | Yes |
| C corporation | Yes |
| Partnership or multi-member LLC | Yes, with care |
| Sole proprietorship or single-member LLC taxed as one | No — you cannot rent to yourself |
What makes the arrangement defensible?
- Fair rent. Quotes from comparable local meeting venues for the same size, duration, and amenities. Luxury-hotel rates for a kitchen-table meeting will not hold.
- Real business purpose. An agenda, attendees, and minutes for each event.
- Proper payment. An invoice from you, payment from the business account, and a rental agreement.
- Separate space. A room already claimed as a regular home office should not also be billed to the business as rented meeting space.
- Day count. Fourteen days in total for the year, including any other rental of the home.
In Sinopoli v. Commissioner, T.C. Memo. 2023-105, an S corporation deducted $290,900 of rent paid over 2015–2017 to its three owners for monthly meetings in their homes, which they excluded under Section 280A(g). With no minutes, agendas, or calendars and no support for the rent, the Tax Court allowed $500 per meeting for about one meeting a month — $16,500 in all — and said the arrangement appeared to be a tax savings scheme to distribute the company's earnings.
Is it worth doing?
For an owner in a high bracket, a dozen legitimate meetings at fair rent can produce a meaningful deduction with no income tax on the other side. The rent is not subject to payroll tax. The risk is the documentation: undocumented "meetings" are an easy adjustment for an examiner.
Frequently asked questions
Does the business issue a Form 1099 for the rent?
Rent paid to an individual is generally reportable on Form 1099-MISC once it reaches $2,000 for 2026 ($600 for 2025 and earlier). The owner still excludes it under the 14-day rule.
Can I count family dinners where we discuss business?
No. The event must be a genuine business meeting a company would otherwise hold somewhere else.
Does it work for a vacation home?
Yes, if you use it personally for more than 14 days during the year (so it counts as a residence) and the total rental days for that home are 14 or fewer.
Do states follow the exclusion?
Most states follow federal adjusted gross income, but confirm for your state.
Official sources
For a dwelling unit used as a residence and actually rented for less than 15 days during the taxable year, section 280A(g) provides: “the income derived from such use for the taxable year shall not be included in the gross income of such taxpayer under section 61.” — U.S. Government Publishing Office, 26 U.S.C. 280A — Disallowance of certain expenses in connection with business use of home, rental of vacation homes, etc. (United States Code, 2024 Edition), https://www.govinfo.gov/content/pkg/USCODE-2024-title26/html/USCODE-2024-title26-subtitleA-chap1-subchapB-partIX-sec280A.htm
The IRS explains: “If you rent property that you also use as your home and you rent it less than 15 days during the tax year, don’t include the rent you receive in your income. Also, expenses from this activity are not considered rental expenses.” — Internal Revenue Service, Publication 527 (2025), Residential Rental Property, https://www.irs.gov/publications/p527
Next step
Fairlight Accounting handles U.S. domestic, cross-border (U.S.–Canada), and international tax returns, plus bookkeeping, payroll, and CFO advisory. Our U.S. Tax Desk sets fair rent and keeps the meeting file that supports it. See pricing or book a free fit call.
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