Last year I learned from a TurboTax employee who helped me on the phone that since 2018 rentals can be treated as qualified business income.
This year I have carefully read the instructions on TurboTax and I see that even if privately owned rental owners don't qualify for the QBI safe harbor (they usually don't need 250 hours of work), they tend to qualify for QBI ("regularity, continuity, and a profit motive").
Now I read this IRS article and it seems to imply that "safe harbor" was introduced to allow real estate to be included, do they mean for professionals to be able to include it? If it is so, I understand this other wording that I found in the TurboTax help: "If a safe harbor is elected, the IRS will not question the treatment of a rental activity as a business." So I guess "safe harbor" helps real estate businesses not need to explain they are a "business or trade."
But I do wonder: Most people who rent out privately do it for profit, so I am not sure who would not qualify for QBI without the safe harbor. TurboTax gives examples of renting out without really caring about the property, for example, letting the renter modify it or not being involved in the property owned. Any other cases?
Thanks.
