Short-Term Rental Material Participation Playbook for 2025
August 28, 2025
Scott Sage
ARTICLE SUMMARY
Big tax perks are back for short-term rental (STR) owners in 2025, but only if you qualify as a material participant. This guide breaks down what material participation means, how to pass one of the IRS’s seven tests, and what STR hosts need to track to unlock nonpassive income treatment and maximize deductions.

Scott Sage
Senior Vice President, Marketing & Customer Experience
Scott is an Airbnb Superhost and industry pro, having founded Home Base BnBs—a short term rental management company that scaled to 200+ units. Scott combines his experience and passion for hosting to empower AirDNA customers' success. When he's not thinking about STRs, he is hiking, playing basketball, or playing pickleball.