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Home / Calculators / Augusta Rule Tax Calculator (IRC Section 280A(g) 14-Day Tax-Free Rent)

Augusta Rule Tax Calculator (IRC Section 280A(g) 14-Day Tax-Free Rent)

The Augusta Rule, codified under Section 280A(g) of the Internal Revenue Code, is one of the most effective tax-saving strategies available to American small business owners, particularly those operating as S-Corporations, LLCs, and C-Corporations. Named after the Masters golf tournament in Augusta, Georgia, this provision allows homeowners to rent their personal residence for up to 14 days per calendar year without having to report any of that rental income on their personal federal tax return (Form 1040). When a business owner rents their home to their own corporation for bona fide business purposes—such as quarterly board meetings, strategic planning sessions, team retreats, or content production—the business claims a full tax-deductible rental expense, while the owner receives the rental payments 100% free of federal, state, and payroll (FICA) taxes. This calculator models your total tax-free cash distribution, total business tax deductions, and the net cash advantage over traditional taxable bonuses or dividends.

IRC § 280A(g) TAX STRATEGY

Augusta Rule Tax Savings Calculator

Calculate how much tax-free income you can legally extract from your business by renting your personal residence to your corporation for up to 14 days per year.

11. Rental Days & Market Valuation

12 dias
1 dia14 dias (Limite Legal)20 dias
$

22. Business & Personal Tax Profile

Combined Marginal Deduction Value:32.0%

Augusta Rule Net Tax Shield

100% Tax-Free Cash to Owner (Form 1040)
$12.000

100% isento de imposto federal (Form 1040) e FICA!

Total Corporate Expense Deduction$12.000
Total Tax Dollars Kept in Your Pocket+$3.840
Average tax saved per corporate meeting day:$320/reunião

Direct Comparison: Standard Bonus vs. Augusta Rule

If you extracted this exact amount as a regular W-2 bonus, salary, or dividend, you would surrender approximately:

Taxes surrendered on regular bonus:-$4.758
Net take-home cash from regular bonus:$7.242
Extra cash pocketed with Augusta Rule:+$4.758

IRS Audit Defense & Compliance Protocol

✓Written Corporate Minutes detailing business purpose, agenda, attendee list, and corporate resolutions.
✓Independent market rate comparables (e.g. Peerspace or local hotel meeting room quotes) substantiating fair daily rate.
✓Formal rental lease agreement executed between the business entity and property owner.
✓Clean electronic bank paper trail showing transfer from corporate account directly to personal account.

How it works

1

Enter the number of meeting/rental days during the calendar year (strictly between 1 and 14 days).

2

Set the daily fair market rental rate based on comparable local executive meeting spaces or event venues.

3

Select your business entity structure (S-Corporation, LLC, C-Corporation, or Sole Proprietorship).

4

Choose your marginal federal income tax bracket and state of residence to calculate the tax shield.

5

Review your total tax-free cash distribution, business write-off, and net savings over traditional bonuses.

Frequently asked questions

What is the Augusta Rule (IRC § 280A(g))?

The Augusta Rule is a provision in the US Internal Revenue Code that permits homeowners to rent their personal home for up to 14 days per year without having to report the rental revenue as taxable income on their personal federal tax return (Form 1040).

How does the Augusta Rule benefit small business owners?

It allows a small business owner (particularly an S-Corp or C-Corp) to rent their primary or secondary home to their company for legitimate business meetings. The business claims a full tax deduction for the rent, while the owner pockets the cash 100% free of federal, state, and FICA payroll taxes.

What qualify as legitimate business purposes for the rental?

Bona fide corporate meetings, quarterly board of directors meetings, annual strategic retreats, shareholder gatherings, corporate team training sessions, and commercial film or photography shoots.

What happens if I rent the property for 15 days or more?

You forfeit the exemption completely. Rented for 15 days or more, every dollar of rental income—including the first 14 days—becomes fully taxable rental income reportable on Schedule E.

How do I establish fair market value for IRS audit defense?

Gather 3 independent written quotes or screenshot comparables from local hotels, executive conference rooms, or meeting rental platforms (e.g. Peerspace) that offer similar capacity and amenities in your area. Keep these on file with your signed corporate minutes.

Is this tool free?

Yes. The site is supported by ads, so you never pay or need to create an account.

Does it work on mobile?

Yes. The page adapts to your screen and does not require installing any app.