What is the tax treatment for a residence with minimal rental use (rented for less...

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Accounting

What is the tax treatment for a residence with minimal rental use (rented for less than 1.5 days per
year)?
Rental income must be included and rental expenses can be fully deducted.
Rental income is excluded and rental expenses are not deductible:
Rental income is included and rental expenses are deductible up to the amount
of rental income.
Both rental income and expenses are included and deductible without limitation.
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