TurboTax will calculate the QBI loss associated with your rental activity and enter it on Form 8995, on line 1. Assuming the rental qualifies as an active business, as opposed to a passive rental...
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TurboTax will calculate the QBI loss associated with your rental activity and enter it on Form 8995, on line 1. Assuming the rental qualifies as an active business, as opposed to a passive rental, the net loss on it in the current year would be a qualifying business income (QBI) loss. As such, it would reduce QBI income reported elsewhere on your tax return and any unused loss would be carried forward to the next year. It is important to note that a QBI loss can only be used to reduce QBI income, it does not therefore represent a deduction from taxable income. If you had QBI loss carryovers from a previous year, the current year QBI loss would be added to the carryover loss to arrive at the QBI loss available in the current year. If you have a passive rental loss, the QBI loss associated with it would be limited to the amount of the loss that is deductible against income in the current year. You can typically deduct up to $25,000 of a passive rental loss against ordinary income in a year, provided your income is under $150,000. An Airbnb would typically qualify as a active business if your average rental period was less then seven days and you were materially involved in the business, as opposed to being a passive investor.