Q: My sister owns 1/4 of a house and I own 3/4. We use it on a time share basis, am I legally able to rent out my time?

A: This is not the type of question that an attorney would feel comfortable answering based on a little bit of information given over the internet from an anonymous source. You really need to make an appointment to talk to an attorney and explain the circumstances surrounding how you and your sister came to own the house in this proportion and give the attorney a chance to read any legal documents involved in the current split of ownership. There is either going to be evidence of some type of partnership agreement with respect to this joint ownership, or no evidence in which case the various rules on joint tenancy including case law decisions, would have to be considered. It is always better to have a written agreement when dealing with multiple owners of real estate to avoid future disputes. So it is probably best to get some type of written agreement if there isn't already one dealing with how the property can be used. You will also want to address the tax issues that come up when you use a residence as a rental. There can be tax writeoffs and depreciation but that only works if the personal use is very limited. Also you may negatively impact your ability to qualify for a capital gains tax credit when you sell the house in the future. Each owner would be eligible to get $250,000 of capital gains tax free if they meet the test that this house served as their primary residence. If you both inherited the house, you would also be entitled to get a step up in basis. So I would advise you to talk to a CPA about the pros and cons of renting the house in this situation.

Generally speaking joint tenants share the rental income of a property in the proportion of their ownership. They also share the the pro-rated costs of maintenance and other costs like property taxes and insurance. Renting the house could increase the cost of insurance and maintenance costs due to cleaning costs and increased wear and tear. So these are other things that you and your sister should discuss and preferably, agree on in writing.