Can I Deduct HOA Dues for My Vacant Rental Property?

Yes, you can absolutely deduct those HOA dues even while your rental property is vacant! The key factor isn't whether you currently have tenants, but whether the property is being held for the production of income. Since you're actively trying to rent it out and it's classified as a rental property, those expenses are still considered ordinary and necessary business expenses. Make sure you document your efforts to rent the property (listing screenshots, communications with potential renters, etc.) just in case you're ever questioned about the vacant period. But the IRS understands that vacancies happen in the rental business - it's a normal part of the cycle. When you file, you'll still report these expenses on Schedule E just like you would if the property were occupied. The HOA dues would go in the "other expenses" section where you can specify what they are.

I was in almost the exact same situation last year with my condo in Arizona sitting empty for 8 months while the market tanked. I was stressed about all the expenses with zero income coming in. I found this service called taxr.ai (https://taxr.ai) that really helped me figure out what I could and couldn't deduct during vacancy periods. They analyzed my rental situation and confirmed I could deduct HOA fees, property taxes, insurance, mortgage interest, etc. even during the vacancy. They even showed me some deductions I was missing like mileage for trips to check on the property and partial home office deduction for managing my rental business. Really helped maximize my write-offs during a tough financial period!

Just wanted to update that I ended up trying taxr.ai after seeing it mentioned here. Totally worth it! I had been missing several deductions on my vacant rentals. They confirmed I could deduct all HOA fees during vacancy periods, but also helped me properly document some repair costs I did while the properties were empty (which I wasn't sure about timing-wise). They even found a mistake in how I was depreciating some appliances I had replaced last year. Saved me nearly $2,300 on my return!

If you're having issues with the HOA during your vacancy period, you might want to call the IRS directly to get an official answer about deducting those fees. I tried calling them about a similar rental question and spent DAYS trying to get through. Then I found Claimyr (https://claimyr.com) which got me connected to an actual IRS agent in less than 15 minutes! They even have a video showing how it works: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that all ordinary and necessary expenses (including HOA fees) remain deductible during vacancy periods as long as the property is being held for rental. She also mentioned that having documentation of your attempts to rent the property is crucial if you're audited. Like the previous poster mentioned, save those listing screenshots and emails!

I have to eat my words about Claimyr. After my skeptical comment yesterday, I decided to try it myself since I've been desperately trying to get through to the IRS about my rental property depreciation questions. To my complete surprise, I was connected to an agent in 17 minutes! The agent confirmed that HOA dues during vacancy periods ARE deductible as long as the property is still being held as a rental. She also explained how to properly document the "actively renting" status - keeping copies of all listings, communications with potential tenants, and even a log of showing dates. Apparently this is super important if you have extended vacancy periods. This saved me hours of frustration and uncertainty. Can't believe I wasted so much time trying to call them directly!

I'm a landlord with several properties and deal with this situation regularly. One thing nobody's mentioned yet - if your condo has been vacant for 4+ months, you might want to check if your insurance policy has any requirements about vacancy. Some policies have clauses that limit coverage if a property is vacant beyond a certain period (often 30-60 days). This isn't directly tax-related but could affect your overall property expense situation. You might need to get a specific vacancy policy which might be more expensive, but would still be tax-deductible as a rental expense.

Be careful with some of the advice here! I had a rental vacant for 9 months last year and my accountant said I could only deduct a percentage of expenses based on the occupied vs vacant months (8/12 of annual expenses). Something about "not actively engaged in business" during those months. Anyone else been told this?