Aggregation of properties

[al g]

I have several real estate rental properties for Schedule E.  I mistakenly aggregated them and now I want to undo it and see if it changes my taxes.  However, the screen which asks questions about aggregation no longer shows up and I can't seem to locate the appropriate form.

Can someone help?

Thanks. 

[Anonymous_]

Did you aggregate all of your rentals into one rental?

TurboTax actually does not support grouping rental activities for real estate professionals so there is no screen for doing so (i.e., where the program would ask if you wanted to elect to group activities).

I would suggest you enter Forms Mode and review your Schedule E and worksheets.

[Carl]

TurboTax actually does not support grouping rental activities for real estate professionals so there is no screen for doing so

While it's true that H&B does not ask any questions or provide any screens or selections concerning aggregation, you can do so manually with Home & Business if you know how. So is 2019 the first tax year you have aggregated your rental properties?

If so, the only way to undo it correctly is to completely and totally delete all rentals and start over from scratch. If 2019 was your first year of doing this, then you didn't import anything from a 2018 SCH E.

If you had rentals on the 2018 return that were not aggregated, then the only possible way to import those rentals correctly into TTX 2019, is to close the program, delete the .tax2019 file in the documents/turbotax directory and then start your 2019 tax return over from scratch.

[al g]

This seems like a serious flaw in TurboTax to me.  There were questions on aggregating on first entering the rental information.  I answered not fully understanding the implications or need for it.  The answer that the entry can't be undone without starting the return from scratch seems like a dreadful way to design any program.  

Nonetheless, thank you for the response.  I appreciate it.

[Carl]

There were questions on aggregating on first entering the rental information.

I am using the desktop H&B version as you are. In my 15 plus years of using the program, I have never been asked by the program about aggregation, nor have I been offered the option on a selection screen.

Now I myself only have three rentals. I suspect you have quite a bit more than that. So while I'm not saying it's not possible for you to have been offered the aggregation option by the H&B version, I would very much like to see a screen shot of that page. If you post a screen shot make sure that no personally identifiable information is readable in the image. Thanks.

[al g]

Thanks, I will post the screen as soon as I start from scratch again.

However, the Aggregation is clearly listed in Form 8995.   I didn't know about aggregation until there was a screen and prompt from TurboTax.  Investigating it, I do not need it.

[Carl]

Appreciate your efforts on the screen shot. Hopefully it will help educate myself and others on this as of yet "unknown" feature of the program. If/when you post it, let us know how many rentals you actually have so we can "play" with the program as part of our own learning process.

[Anonymous_ · Accepted solution]

@al g Your original post threw me way off the track since it appeared as if you were grouping several rental properties into one for the purposes of reporting them as one activity on Schedule E.

The aggregation of rentals (that is only applicable to real estate professionals) is not supported by TurboTax.

However, it now appears that you are referring to Form 8995 and the aggregation of business operations for the purposes of the QBI (Qualified Business Income) deduction and not the aggregation of all of your rentals into one on Schedule E. That is an entirely separate issue.

The reason you even saw the screen you referenced was because you indicated that your taxable income might exceed $160,700 (or $321,400 if married filing a joint return). Otherwise, the "aggregation" screen does not appear.

If you go back to each rental property and, again, indicate that your income might exceed $160,700 (or $321,400 if married filing a joint return) and answer "No" to the specified services questions, you will again be given the option to combine the rental into another or indicate that the "business" is independent of any other activities (see screenshot below).

[al g]

Yes, my income does not exceed those thresholds and I shouldn't be messing with it.  But I made a mistake.

Thanks for straightening things out.

[sidjain78]

This solution does not work - the screen to decide on aggregation does not come again. It is once and done.

[sidjain78]

I just went through the same situation. None of the responses seemed to make sense - I was not getting the option to unaggregate. I didn’t want to delete and recreate the rentals. On top of it, TT didn’t allow e-filing with business aggregation worksheet which was a hugely unacceptable. So I switched TT into forms mode (available in the desktop version). Then went to 8995-a QBI worksheets for each property. I deleted those worksheets and automatically TT unaggregated the two rentals. That is the simplest and most sensible solution. Otherwise you will be going around in circles and not be able to e-file. 

[DavidS127]

If you do not need or want to aggregate any businesses, here is how to “un-aggregate” them in TurboTax Online or TurboTax Download/CD: 

1. Go to Delete a Form: In the left menu, select the dropdown arrow next to Tax Tools and then under that select Tools; in the pop-up window Tool Center, choose Delete a form.
2. Find the QBI Component form for the aggregated businesses.  Delete that QBI Component sheet.
3. Now, go to Review and start the review routine.
4. You will have an error for each business that no longer has a QBI Component form.  For each of those businesses, you will see the “primary” form for that business (Schedule C, Schedule E, K-1). It will be highlighted for Question A in the Qualified Business Income Deduction Smart Worksheet.
5. Double click in the highlighted Question A box, and you will get a pop-up asking you to link to a QBI component worksheet.  Create a new copy for that business (e.g., give it the name of that business).
6. Continue until you have created a separate QBI component worksheet for each business that you do not want to aggregate.

Note that you could also use these instructions to aggregate businesses.  Delete the QBI component worksheets for each business you want to aggregate, go to the Review, and link all the businesses to the same QBI component worksheet.  But, you will not be able to e-file your tax return and must print and mail the return.

If you want or need to aggregate any businesses, the return is still print and mail only in TurboTax.  TurboTax is working with the IRS to enable e-file for aggregated QBI businesses and the QBI netting/carryforward worksheet, but there is not a date when that will be available.

You'll need to decide whether or not you want or need to aggregate any businesses in 2019.  Once you aggregate, you must continue to aggregate in future years.  But, not aggregating last year does not preclude you from aggregating this year.    Refer to the IRS instructions for Form 8995-A for more information on aggregation.

[legendpeng]

I am using mac version, it seems like I can't just delete QBI Component form, I have to delete all K-1 forms. then when I add them back, they would be aggregated again, not sure if this is because I chose aggregated last year. 

any progress on "TurboTax is working with the IRS to enable e-file for aggregated QBI businesses and the QBI netting/carryforward worksheet" ? my tax return is about 300 pages, I really hope  TurboTax can solve the efile issue soon.

[DavidS127]

Check your 2018 tax return for a "Schedule B--Aggregation of Business Operations".  That IRS-prescribed form for 2018 reporting will show the businesses you aggregated in 2018.

That will not fix the e-file problem, but at least you will know if you must aggregate in 2019 or instead have to option to not aggregate the businesses.  That way, you won't spend time "un-aggregating" when it is not an option for your tax return.

@legendpeng

[legendpeng]

@DavidS127 you are right. I used "Schedule B - Aggregation of Business Operations" last year so un-aggregate is not an option for my case.