Unlocking the Benefit of the Augusta Rule in Myrtle Beach: A Tax Savings Guide
Are you a homeowner or business owner in Myrtle Beach looking for creative ways to save on taxes? The Augusta Rule, an IRS tax strategy under Section 280A(g), allows you to earn tax-free income by renting out your home for 14 days or fewer per year. For Myrtle Beach homeowners, this is an especially powerful strategy because your coastal property commands premium rental rates during peak tourism season. Here is how Myrtle Beach families and business owners can maximize this unique opportunity in 2026.
What Is the Augusta Rule?
The Augusta Rule (IRS Section 280A(g)) originated in Augusta, Georgia, where homeowners rent their houses during The Masters golf tournament. According to the IRS, if you rent your home for 14 days or fewer per year, you do not have to report the income on your tax return. This can result in thousands of dollars in tax-free income for Myrtle Beach homeowners, especially during busy tourism events like golf tournaments, bike weeks, festivals, and beach season.
Quick Answer: The Augusta Rule lets Myrtle Beach homeowners rent their personal residence for up to 14 days per year and keep the rental income completely tax-free. No reporting required. Business owners can also rent their home to their own company for meetings and events.
How Does the Augusta Rule Work in Myrtle Beach?
Here is the step-by-step process for using the Augusta Rule as a Myrtle Beach homeowner:
- Own a Home in Myrtle Beach — This works for single-family homes, condos, vacation homes, and even beachfront properties.
- Rent It Out for 14 Days or Fewer per Year — The renters can be vacationers, event attendees, or even your own business entity.
- Set the Fair Market Rental Rate — Check comparable rates on Airbnb, VRBO, or similar platforms for Myrtle Beach properties during the same dates.
- Keep Detailed Records — Document who rented, how much was paid, rental dates, and the purpose of the rental.
- Collect Payment — Accept payment by check, wire, or other traceable method. Keep all receipts.
Myrtle Beach is one of the top tourist destinations on the East Coast, with over 20 million visitors per year. This means Myrtle Beach homeowners are uniquely positioned to command premium rental rates during peak weeks, making the Augusta Rule especially lucrative here.
Real-Life Example: Renting to Your Own Business in Myrtle Beach
If you are a business owner in Myrtle Beach, the Augusta Rule lets you rent your home to your business for meetings, retreats, team gatherings, or client entertainment. Your business can deduct the rental expense as an ordinary business cost, and you receive the rent tax-free, so long as it is within 14 days per tax year.
| Scenario | Tax Impact |
|---|---|
| Business rents owner’s Myrtle Beach home for strategy retreats (up to 14 days) | Business gets a deduction; owner receives tax-free income |
| Home rented to vacationers during Myrtle Beach Spring Bike Week | Owner collects tax-free rent (up to $500+/night during peak events) |
| Beachfront condo rented during summer peak (14 days max) | Tax-free income of $5,000-$10,000+ depending on property value |
Pro Tip: When renting your Myrtle Beach home to your own business, make sure the rental rate is at fair market value. Get a written appraisal or pull comparable Airbnb listings for Myrtle Beach on the same dates. The IRS may scrutinize above-market rates in self-rental transactions.
South Carolina Tax Considerations for Myrtle Beach Homeowners
While the Augusta Rule is a federal provision, Myrtle Beach homeowners should also understand how South Carolina state tax rules interact with this strategy:
- South Carolina Income Tax: SC has a progressive income tax with rates from 0% to 6.5% (2025 rates). The Augusta Rule exclusion applies at the federal level, and South Carolina generally follows federal treatment for rental income exclusions.
- Accommodations Tax: Myrtle Beach and Horry County impose an accommodations tax on short-term rentals (typically 2% local + state sales tax). If you rent for 14 days or fewer under the Augusta Rule, you may still need to collect and remit accommodations tax on those stays. Consult with a local tax professional to confirm.
- Property Tax Assessment: Renting your Myrtle Beach home for 14 days or fewer should not change your property tax assessment from owner-occupied to investment property. However, if you exceed 14 days, the county may reclassify the property at a higher tax rate.
How Much Can You Save With the Augusta Rule in Myrtle Beach?
The potential savings depend on your property value and the rates you can charge during peak Myrtle Beach tourism weeks. Here is a realistic calculation:
| Rental Days | Nightly Rate | Tax-Free Income | Tax Saved (25% bracket) |
|---|---|---|---|
| 7 days | $350/night | $2,450 | ~$613 |
| 10 days | $400/night | $4,000 | ~$1,000 |
| 14 days | $500/night | $7,000 | ~$1,750 |
| 14 days (luxury property) | $800/night | $11,200 | ~$2,800 |
Did You Know? Myrtle Beach hosts over 20 million visitors annually, and peak-season nightly rates for beachfront properties can exceed $500/night. Even renting for just 14 days during the summer could generate $7,000+ in completely tax-free income.
Documentation Requirements for the Augusta Rule
Proper documentation is essential to protect your Augusta Rule benefit. If the IRS ever questions your claim, you need to have these records ready:
- Written rental agreement for each rental period, signed by both parties
- Fair market value documentation showing comparable Myrtle Beach rental rates
- Proof of payment via check, bank transfer, or credit card (avoid cash if possible)
- Calendar log tracking which days the property was rented and to whom
- Meeting agendas if renting to your own business (to establish business purpose)
- Photos of the event or meeting as additional evidence of business use
Practical Tips for Maximizing the Augusta Rule in Myrtle Beach
- Time your rentals during high-demand Myrtle Beach events for maximum rates
- Work with a CPA familiar with the Augusta Rule, like Uncle Kam Tax Professionals
- Review IRS documentation: IRS Topic No. 415 – Renting Residential and Vacation Property
- Research local rental rates before setting your price
- Keep your total rental days at 14 or below. Going to 15 days makes ALL rental income taxable.
- Explore other Augusta Rule strategies beyond Myrtle Beach
The Bottom Line
The Augusta Rule is a powerful, often-overlooked tool that allows Myrtle Beach residents and business owners to claim legitimate tax-free income. Whether you rent your beachfront property to vacationers during peak season or rent your home to your own business for corporate events, the tax savings are real and significant.
For optimal results, consult a tax professional experienced with local South Carolina and federal guidelines. Schedule your free consultation with Uncle Kam today and start putting the Augusta Rule to work for your Myrtle Beach property.
Disclaimer: This article is for informational purposes only and does not constitute tax, legal, or financial advice. Consult with a qualified tax professional for guidance specific to your situation.
Last updated: February, 2026
Frequently Asked Questions
How much can I charge when renting under the Augusta Rule in Myrtle Beach?
You must charge a fair market rental rate. Check comparable Myrtle Beach properties on Airbnb or VRBO during similar dates. For peak season beachfront properties, rates of $300-$800 per night are common. The key is documenting that your rate is comparable to similar properties in the area.
Do I need a formal lease agreement for the Augusta Rule?
Yes. You should have a written rental agreement for each rental period. This protects you if the IRS questions the transaction. The agreement should include the rental dates, amount, payment terms, and the names of both parties.
Can I rent my Myrtle Beach home to my own business?
Yes. Many business owners rent their home to their own S Corp, LLC, or C Corp for meetings, retreats, or client events. The business deducts the rental payment as a business expense, and you receive the income tax-free. Make sure the rate is at fair market value and keep meeting agendas and attendance records as documentation.
Can I rent to friends or family under the Augusta Rule?
Yes, as long as they pay fair market rent and you maintain proper documentation. The IRS does not prohibit renting to related parties, but the transaction must be arms-length with real payment at a reasonable rate.
Does the Augusta Rule apply to rental properties or only primary residences?
The Augusta Rule applies to personal residences, including your primary home, second homes, and vacation homes. It does not apply to properties that are already classified as full-time rental properties. If your Myrtle Beach property is a vacation home that you use personally, it qualifies.
What happens if I go over 14 rental days in Myrtle Beach?
If you rent for even one day over 14, ALL rental income becomes taxable. You would then need to report all rental income on Schedule E and could deduct rental expenses proportionally. The 14-day limit is strict, so track your rental days carefully.
Do I need to pay South Carolina accommodations tax on Augusta Rule rentals?
Potentially yes. South Carolina and Horry County impose accommodations taxes on short-term rentals. While the federal income tax exclusion under the Augusta Rule is clear, state and local accommodation taxes may still apply. Consult with a South Carolina tax professional to understand your specific obligations in Myrtle Beach.
