Vacant Land Tax Write-Offs for Landowners Renting in 2026 (Honest Guide)

The basic framework

Rental income from your land falls into two tax categories that matter:

• Schedule C (self-employment): When you're actively involved , checking renters, maintaining sites, responding daily. Subject to both income tax and self-employment tax (~15%). Most Hipcamp and Peerspace hosts file here.
• Schedule E (rental real estate): When rental is largely passive , long-term tenants, minimal active involvement. Subject to income tax but typically not self-employment tax. Most solar lease income and long-term Neighbor storage falls here.

The IRS treats the two differently. Schedule E is more favorable (no SE tax) but has stricter passivity requirements. If you're active in managing rentals (responding to bookings, meeting renters, actively marketing), you're usually Schedule C.

What you can deduct (by platform)

Neighbor.com storage

• Neighbor's 15% service fee
• Portable toilet or utility rental (if provided)
• Fencing, gate repairs, and security improvements
• Homeowner's policy commercial-use rider
• Maintenance (mowing, gravel resurfacing, plowing)
• Mileage to the property (if not primary residence)
• Reasonable allocation of property taxes to the rental area (roughly proportional to space used)

Hipcamp camping

• Hipcamp's 10% service fee
• Porta-potty rental (standard for tent sites)
• Fire ring, picnic table, amenity purchases
• Site preparation (clearing, gravel, signage)
• Marketing photography costs
• Depreciation on permanent structures (glamping tents, cabins) over 7-15 years

Solar land lease

• Property tax allocation to leased area (some states exempt solar-leased land from standard residential tax rates)
• Legal fees for lease review
• Any site preparation costs borne by the landowner
• Loan interest if the property is mortgaged (pro-rata)

Peerspace / Giggster events

• Platform fees (15% on Peerspace)
• Cleaning costs between events
• Site prep and decor investments (depreciation)
• Photography and marketing costs
• Insurance riders

Capital improvements: depreciate, don't expense

Anything with a useful life over one year is a capital asset. Instead of deducting the full cost in year one, you depreciate it over the asset's useful life:

• Fencing, gates: 15-year depreciation
• Gravel driveway additions: 15-year
• Electrical hookups (30-amp, 50-amp): 7-year
• Portable structures (glamping tents, sheds): 7-year
• Permanent structures (cabins): 27.5-year

Section 179 and bonus depreciation may allow faster deduction for qualifying improvements, especially in the first year you begin renting. This is where a CPA adds real value.

Commonly missed deductions

• Home office allocation for time spent managing listings, if you have a dedicated workspace.
• Internet/phone allocation if you communicate with renters.
• Accounting software or tax prep related to rental income.
• Property tax allocation to rental area (often overlooked on smaller listings).
• Tool / equipment depreciation for mowers, tractors, or generators used partly for rentals.

What's NOT deductible

• The land itself (you can't depreciate land value)
• The cost of capital improvements (those get depreciated, not expensed)
• Personal-use portions of mixed-use property
• Travel to/from your primary residence (if it's also your rental site)
• HOA dues not specifically tied to the rental area

Quick decision tree

• Under $600 in rental income: Not reportable (though still track it). No 1099 issued.
• $600-$5,000: Self-file with TurboTax self-employed or similar. Keep receipts. Most common approach.
• $5,000-$25,000: Worth consulting a CPA once to optimize Schedule C vs. E classification and depreciation strategy. $300-$600 in fees, typically recoups in year one.
• $25,000+: Definitely hire a CPA. Consider LLC formation for liability protection and possible tax efficiency.

State-level considerations

Most states treat rental income the same as the IRS, but a few have wrinkles:

• California: Rental income is subject to state income tax. Solar lease income may qualify for special classification.
• Texas, Florida, Nevada: No state income tax on rental income.
• New York: New York City adds city income tax for residents renting out property.
• Hawaii, Oregon, Washington: Some rental platforms collect state excise or transient occupancy taxes. Check Hipcamp and similar for specifics.

Frequently asked questions