Non-Owner Occupied

Non-owner occupied (also known as non-primary residence) is a term used to describe a property that is not the primary residence of the owner. This can include properties that are rented out, used as vacation homes, or simply held as an investment.

There are a few key differences between non-owner occupied properties and owner-occupied properties. First, the mortgage interest on a non-owner occupied property is not tax-deductible. This is because the IRS considers the property to be a business expense, rather than a personal expense. Second, the capital gains tax on the sale of a non-owner occupied property is higher than the capital gains tax on the sale of an owner-occupied property. This is because the IRS considers the sale of a non-owner occupied property to be a taxable event, while the sale of an owner-occupied property is not.

There are also a few different types of non-owner occupied properties. These include:

• Rental properties: These are properties that are rented out to tenants. The owner of the property is responsible for collecting rent, paying the mortgage, and maintaining the property.
• Vacation homes: These are properties that are used for vacation purposes. The owner of the property may rent it out when they are not using it, but they are not required to do so.
• Investment properties: These are properties that are purchased with the intention of selling them at a profit in the future. The owner of the property may rent it out in the meantime, but they are not required to do so.

Non-owner occupied properties can be a good investment, but it is important to understand the tax implications before you purchase one.