The safe harbors mention in ColeenD3's response refer to taking an expense for a purchase for a rental property rather than depreciating it as an asset over several years.
You are referring to the "safe harbor" in treating rental property as a business in order to qualify for the Qualified Business Deduction (QBI).
Under the safe harbor, a “rental real estate enterprise” is treated as a trade or business for purposes of Sec. 199A if at least 250 hours of services are performed each tax year with respect to the enterprise.
The choices presented in the screen you submitted are:
- Do you want to elect the Safe Harbor for just the one property?
- Do you want to elect the Safe Harbor for all your properties together (a "rental real estate enterprise")?
- Don't elect and forgo the QBI deduction.
If you meet the qualifications for your rental properties, I would think you would select the second option on the screen and include the income from all your properties for the QBI credit.
In order for the rental income to be considered QBI, each rental real estate enterprise (a rental property or group of similar rental properties, including K-1 rental income) must satisfy these requirements:
- Each enterprise maintains its own books and records to track income and expenses;
- At least 250 hours of rental services are performed per year per enterprise; and
- Contemporaneous records of services performed are kept which includes who performed the service, description of service, the date of the service, and how long it took (who, what, when, and how long).
Please see these TurboTax Help articles for additional information:
