TaxGuyBill
Level 15

As Lisa pointed out, if it was 100% personal use then converted to 100% rental use, you DON'T enter any personal days.  And you only enter the expenses that were incurred  DURING the rental period (don't enter the full-year expenses).

Entering the personal days (which is wrong in your case) makes it non-passive income, which is why ProSeries is not treating it as Passive income that disqualifies EIC.

 

However, the law says that Passive Income can disqualify EIC, but so can "rents or royalties not derived in the ordinary course of a trade or business".  Although rental income for a house would SEEM to be "rents", the program seems to interpret "rents" as rental of non-real estate, and I don't remember if that is correct or not.