Frequently Asked Questions

1. The Augusta Rule, also known as IRS Section 280A(g), is a tax provision that enables business owners to rent their homes to their businesses for up to 14 days each year free of federal and state income tax.

1. Eligible: Corporations (whether taxed as  S-Corporations or, C-Corporations), Single Member LLCs (only if taxed as S or C Corporations), Multi-Member LLCs (non-spousal) or Partnerships with a distinct Employer Identification Number
2. Gray: LLCs and Partnerships where the sole Members are spouses. We recommend that your meetings need to include at least 3 other business associates in order to be defensible.
3. Not Eligible: Sole proprietors, Single-Member LLCs (unless the SMLLC is taxed as a C-Corporation or S-Corporation, in which case it is eligible)

Yes, The TAR Plan is compliant with IRS regulations under section 280A(g) of the IRS code. We stay updated with the latest tax regulations and make necessary adjustments to the platform to ensure compliance and accuracy for you. However, do not confuse compliance in principle with a wild rental amount of your choice. The IRS may disagree with the amount of the rental – this is an inherently gray area. The Digital Valuation that comes with the Plus & Premium Plans is conservative and highly defensible. Use higher numbers at your own risk.

The TAR Plan compares property data from your neighborhood, market trends, and factors such as location, amenities, timing, and property size. The plan provides you with a suggested rental value based on prevailing rates in your area. The suggested amount for each day in a month will be displayed in a calendar format. It allows you to visualize and plan your events based on the rental income potential for specific days.

You are welcome to seek out and upload your own supporting documentation for a different rate. By using your own data you assume any risk associated with it. TAR suggests that you seek counsel from your Tax Pro before using your own data.

Although rare, data is sometimes lacking, especially if you have a large or luxury residence. In such cases, you and your Tax Pro will need to collaborate to establish a rental rate based on local data such as STRs, Hotels, Convention Centers, & Wedding Venues, depending on what is appropriate for your business rental purpose.  You’d need to upload such supporting data. See [link to resource] for more info.

Our take is that little pigs get fat while big hogs get slaughtered. Go too high and your odds of attracting or losing an audit increase. Go too low and you’re leaving money on the table. Aim for a Goldilocks number – “just right”.

This is a gray area. An argument can be made that certain uses command a higher rental value. For example, an entire film crew accompanied by actors and a mass of audio-visual equipment has commonly resulted in market rental rates that are far higher than the norm.

Yes. As such, our data is updated in the calendar view of the app to show different rates for different days that prevail in the local market.

“It depends”, of course! Our dynamic data set reflects market swings, even by the day. It is also on the conservative side. Some sources have static pricing for the year, others are more nuanced and change with circumstances. If you upload your local data from qualifying sources, it may be static yet defensible if it truly reflects market pricing. What constitutes “market pricing” is subjective and debatable. Simply cherry-picking data and applying it across the board without regard to context is likely to fail if audited.

1. It’s better than “nothing”. However, the longer one waits to document events, the less defensible they are if challenged – and any audit protection from TAR will be voided. The best practice, by far, for all IRS-related documentation is that it be contemporaneously created & recorded. The longer documentation is put off, the less credibility it has on audit.

1. You will receive real-time notifications on our platform as to important events, reminders, and tax filing deadlines. Whenever there is a new notification, the notification count will be highlighted on the bell icon, ensuring you never miss any crucial information. You may also opt-in to receive email notifications.

Basic and Plus Plans allow for one residence. Premium allows for up to three. Importantly, the IRS defines a residence as any place with a bedroom, bathroom, and kitchen that you (or family members) overnight in for 14+ days during the year. It can also apply to your stays at your children’s residences. Learn more here [Link to resource]

1. Manual valuation is “do it yourself”. You do the research, set the rental price, gather the supporting documents, and upload it all to the system. Digital valuation reduces your workload by allowing us to provide you with a rental price and supporting documentation.

1. We pay a princely sum for access to a national dataset. The dataset includes information from multiple major short-term rental providers.

1. Sadly this can happen. We ask for your Tax Pro’s info during sign-up so we can contact them and find out early on if they will support TAR or not. If not, you will have two options:
   1. Continue with your current Tax Pro and pay more tax than you need to – TAR is not rocket science and is well supported via our educational videos, including citations to the relevant law. If your current Tax Pro is this conservative…who knows what else they are missing on your behalf?
   2. Switch to a Tax Pro who will work with TAR (and probably be better informed as to other tax matters as well) and save on taxes. If you decide to go with option 1, we will refund your subscription.  If you decide to go with option 2, we are happy to share a list of supporting Tax Pros.

1. Once you have created an event, you can earn a referral bonus. Simply refer new clients to The TAR Plan, and for each successful referral, you will earn a $50 credit toward your next year’s TAR subscription, up to the full amount of whichever plan you choose.

1. Yes. Every account will allow you to add unlimited business. The limiting factor for Augusta Rule deductions is the number of residences not the number of businesses. Each residence can be rented for up to 14 days/year.