Can't efile because of QBI Rental Real Estate Enterprise Statement

I have several rental properties that I have to aggregate under the QBI Safe Harbor allowance, since this is the only way for me to satisfy the record-keeping requirements as I don't spend enough time on each property by itself. However, when I do my federal review, I get the message that I have to file a paper return because I "have QBI Rental Real Estate Enterprise Statement" that is not supported by TurboTax for e-filing.

 

I seem to recall some other threads (which I can no longer find) where a TT expert said there might be an update which would allow attachment of a signed .pdf and therefore the ability to e-file? I'm wondering if anyone knows if there is such a possibility, or if I should just resign myself to the immense hassle of printing 100 pages and mailing them, as the deadline is fast approaching.

 

Thanks for any feedback or suggestions!

DavidS127
Expert Alumni

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No, there is no information available to me that indicates or suggests that e-filing the Rental Real Estate Enterprise "safe harbor" statement will be supported by 7/15/2020.  Returns with this attachment are print and mail only.

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I do not understand why Turbotax and IRS can not work together to fix this bug to allow for digital sign the form, the whole point of using Turbotax is that I can do efile and I do not need to print and mail the forms. If I can not do it what is the point of buying Turbotax!  I want my money back. 

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I agree with you, David. Time to find a different product or means of filing our returns next year. Although we have been loyal TurboTax customers, this year we have had one problem after another, requiring more time to fix the problems than it would have taken to fill out the returns in the first place! And now, not even being able to file electronically? Absolutely ridiculous.

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I have the same situation.  I've using efile with TT for years.  Do we really need to print pages of tax return and mail?  Did TT update their attachment? Or can TT allow us to efile and we can add statement by mail?

DavidS127
Expert Alumni

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The IRS requirement to attach a signed and dated rental activity safe harbor election statement is new for the 2019 tax season; the IRS did not issue that safe harbor procedure until the fall of 2019.

 

At this time, that signed and date rental activity safe harbor election cannot be attached to a TurboTax return as a PDF; the tax return must be printed and mailed.

 

@cathyjohn

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Yes, this is unfortunate that TT did this for me also, so I need to mail a paper return. You can try deleting that SH stmt, although I did that, and it took away my Q business deduction for that property. I have other businesses also, although that is the only one that TT made me fill out a SH stmt for! TT should upload that form and have you sign electronically for it, then allow the e filing

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An idea would be to not take the QBI deduction for rental properties and then e-file your return. After it's been accepted you could wait a month or so and then file an amended return (which should only be a few pages) and take the QBI deduction. Clearly you lose some time value of money and it flags the QBI issue, but it may be better than printing off tons of forms and mailing the original return.

 

Just a thought - any comments on this idea?

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Taking the QBI Safe Harbor does still require you to print and mail the return.  TurboTax does not have e-file available for that option.

 

What can I expense or depreciate with the business safe harbor election?

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I am a 20 year user of both Quickbooks and TurboTax and am disappointed in the inability to e-file my return due to the QBI Deduction and the Safe Harbor elections.  Is Intuit addressing this issue?  In today's environment with Covid, the IRS is behind by millions and millions of returns.  Last year, I had to get a Tax Advocate involved twice to speed up the processing of two years worth of tax returns with the IRS due to their backlog.  I was really hoping that this year I would be able to e-file to avoid their paper-processing delays.  Is this just the way it's going to be, or will Intuit include the ability to attach a PDF file to our returns, in order to provide the IRS with the signed form they are requesting.  I fully qualify for the QBI and Safe Harbor elections, so that is not an issue.  My QBI deduction is almost $8000.00, so choosing to ignore the deduction is out of the question.  I would like someone to address this with your programming staff at Intuit and at least let those of us faced with this issue be given an answer.  My decision to use TurboTax in the future DOES ride on this decision.  

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TT still has not fixed this issue for year 2020 return. It requires me to print out and mail the documents. 

 

 

DAVIDHK
New Member

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I sent the following message to the  IRS Taxpayer Advocate Service https://www.improveirs.org/submit-a-suggestion/

 

IRS is not allowing taxpayers who use the QBI business income deduction to efile the 2020 tax return due to an apparent requirement to physically sign a Section 199A Rental Real Estate Safe Harbor Statement under penalty of perjury.  This should not be necessary as the signature on the return applies to all statements included in the return.  The inability to efile using a tax service, such as Turbo Tax which is preventing efiling because of the issue, is creating an undue burden on taxpayers as they will now have to print and mail the tax return which some instances include more than 100 pages.

 

I'll share the reply if I get one.  I'm also thinking about sending the message to the Secretary of the Treasury

TiffanyL
Intuit Alumni

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@DAVIDHK, you can wait to get a reply from the IRS Taxpayer Advocate Service, but at this point, your only option would be to print and mail your return.

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The IRS does not disallow efiling with the QBI RREE statement.  It is Turbotax that is incompetent and unable/unwilling to work on enabling efile with QBI RREE

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I totally agree with you.  I am hitting the same issue.  Have been using TT for years, and now this becomes a point breaker for me.  

I am starting to research for different tax software.