Less than 250 hours may qualify. Per IRS 1-18-19: This includes services performed by owners, employees, and independent contractors and time spent on maintenance, repairs, collection of rent, payment of expenses, provision of services to tenants, and efforts to rent the property. Hours spent by any person with respect to the owner’s capacity as an investor, such as arranging financing, procuring property, reviewing financial statements or reports on operations, planning, managing, or constructing long-term capital improvements, and traveling to and from the real estate are NOT considered to be hours of service with respect to the enterprise. A rental real estate enterprise that satisfies the proposed safe harbor may be treated as a trade or business solely for purposes of section 199A and such satisfaction does not necessarily determine whether the rental real estate activity is a section 162 trade or business. Likewise, failure to meet the proposed safe harbor would not necessarily preclude rental real estate activities from being a section 162 trade or business. (My comment: Less than 250 hours may qualify provided activities are sufficient and meet the Code Section 162 standard, which essentially is: There shall be allowed as a deduction all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business. In general, a trade or business is an activity engaged in for profit. I believe most people with rental real estate will take the deduction if the property is rented and not held merely for investment/appreciation.)
