Is a Home Exchange a rental?

[Lincolnpark]

What is the name of your state (only U.S. law)? Massachusetts

We live in a condominium community and the Master Deed states: "No unit shall be leased, rented or let unless upon a written agreement therefore in a form and content acceptable to the District Directors and for a term of less than three (3) months...."

Our directors are interpreting this as forbidding short-term vacation home exchanges, considering them short term rentals and their attorneys have confirmed this interpretation.

My question is whether there is any legal grounds for claiming that home exchanges are NOT rentals and therefore not subject to this ruling?

 

[OHRoadwarrior]

Interesting, I would have not opted for rental, I would have opted for a let. Their lawyer must have chosen it based on you both giving something of value in exchange.

 

[tranquility]

From a tax viewpoint, a home exchange is a rental. In theory, you are bartering. While the IRS would not care if it were for a short period(s) per year (by statute), they could care. Because of this, I'd say an "exchange" is the same as a rental or other let of possession.

 

[Lincolnpark]

Thanks for your replies. I was hoping we'd have at least a little wiggle room on this. In many cases, home exchanges are not simultaneous and there doesn't seem to be a binding contract governing the barter. Is seems kind of grey to me.

 

[tranquility]

There is no gray from a tax perspective. From a real property one, it seems like such an exchange was contemplated by the term "let". I do understand you want to not be prevented by the contractual provision, but I'd focus on making sure the board doesn't care as I believe you would lose in court.

 

[Lincolnpark]

Tranquility, thanks very much for your input.