Tax Implications of EV Charger Installation & Airbnb Portion of Primary Residence

You've got an interesting situation with both the EV charger credit and Airbnb business use of your home. Here's how I'd approach it: For the EV charger, you can claim the 30% Clean Energy Tax Credit (now up to 30% of costs), but you'll need to allocate it based on personal vs. business use. Since your Airbnb takes up 25% of your home, you'd typically allocate 75% of the charger costs to personal use (eligible for the full credit) and 25% to business use. For the business portion, you wouldn't claim the tax credit on that 25%, but instead depreciate that portion as a business expense on your Schedule C or E (depending on how you report your Airbnb income). For your Airbnb deductions, the square footage method is a solid approach for allocating shared expenses like mortgage interest, property taxes, utilities, insurance, etc. Keep in mind that you can fully deduct expenses that are 100% for the Airbnb portion (special furniture, supplies, cleaning services specific to that space). Just make sure you're keeping detailed records of all this to support your allocations if asked!

After struggling with a similar situation last year (home office + solar panels), I discovered this amazing tool called taxr.ai (https://taxr.ai) which was a huge help. I uploaded my receipts and property docs, and it automatically identified what percentage I could claim for the energy credits vs business depreciation. It actually found some mixed-use allocations I was doing completely wrong! The automated analysis saved me from making a costly mistake on my Schedule C. If you're confused about how to split these overlapping deductions, it might be worth checking out.

I need to eat my words about being skeptical of taxr.ai (https://taxr.ai). I finally gave it a try with my complicated home office + rental property situation, and it was incredibly helpful. The system actually identified that I could take the EV charger credit for my personal portion AND depreciate the business portion, which my accountant had missed. It even flagged that I was under-reporting some of my Airbnb expenses by not properly allocating shared utilities. Definitely saved me more than it cost and gave me documentation to back up my deductions.

If you're having trouble getting clear answers from the IRS about how to handle these overlapping deductions, try Claimyr (https://claimyr.com). I was on hold with the IRS for HOURS trying to get clarification about the EV charger credit with mixed business use, but after using Claimyr, I got through to an agent in about 20 minutes. They have this callback system that basically waits on hold for you - you can see how it works in their demo video: https://youtu.be/_kiP6q8DX5c. The IRS agent confirmed my understanding of how to allocate the credit between personal and business use and gave me specific guidance for my situation.

I've completely changed my mind about Claimyr. I finally broke down and tried it after another failed 3-hour hold attempt with the IRS. Within 45 minutes, I got a call back and was connected with an IRS representative who actually specialized in small business tax issues. She walked me through exactly how to allocate my EV charger between personal and Airbnb use, and confirmed I was calculating my square footage deductions correctly. She even emailed me the relevant IRS publications. I'm shocked at how well it worked - wish I'd known about this months ago instead of wasting days on hold.

Has anyone considered how charging guests' EVs might affect your utility deductions? I've been doing Airbnb for years and recently installed an EV charger. I'm now tracking electricity usage spikes during guest stays with EVs and deducting those as direct Airbnb expenses separate from my square footage allocation for general utilities. My accountant says this is legit as long as I have good documentation.

Wait, I'm confused about something more basic. If your primary residence has an Airbnb component, aren't you supposed to depreciate that portion of your home? And if so, will that mess with your capital gains exclusion when you eventually sell? I've been avoiding any home office or Airbnb deductions because I'm worried about tax implications when selling.

This is a great discussion! I'm dealing with a similar situation but with solar panels instead of an EV charger. One thing I learned from my tax preparer is to be really careful about the "exclusive use" test for business portions. The IRS can be strict about spaces that are used for both personal and business purposes. For your EV charger situation, since it's installed on your property and serves both your personal vehicle and potentially guest vehicles, you'll want to document everything carefully. Keep records of when guests use it versus your personal use. I'd also recommend getting a letter from your tax professional outlining your allocation methodology in case you ever get audited. Also, don't forget that if you're taking depreciation on the Airbnb portion of your home (which you must), you'll need to track that carefully for when you eventually sell. The depreciation recapture can be a surprise tax hit that catches people off guard years later.