DavidS127
Expert Alumni

Business & farm

If you don't qualify for the "rental safe harbor", take a look at the Schedule E Wks for the rentals.  

 

In Forms mode (icon at top right in blue bar), look in the left column to find the Schedule E Wks form for each rental property.  When you click on it the form will open up in the window.

 

Once you are in the Schedule E Wks, scroll down just past line 22 to find the Qualified Business Income Deduction Smart Worksheet.

 

Check question A to see if the "Is this activity a qualified trade or business" question is answered Yes or No.  You want it to say No, so make sure that is selected.  Next, see if the box is checked  for  "This rental qualifies as a business under the safe harbor requirements of Notice 2019-07".  You do not want it to be checked.

 

While you are in that section, also notice under that same question A which QBI Component sheet is linked to that Schedule E wks.  It may help to delete any existing QBI Component worksheets, especially if they are aggregated (i.e., both Schedule E wks forms use the same QBI Component worksheet).

 

After doing this for both rental properties, your issue should be resolved, unless there is something else in the tax return generating QBI, such as a box 5 Section 199A dividend on a Form 1099-DIV.  You can check for this in the QBI Ded Summary form while in Forms mode.

 

@Donna44

 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"