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cynthia-goldsmit
New Member

I receive income from a lease of a small office building I own in which I am responsible (not the tenant) for all maintenance. Is this a Qualified Business Income?

 
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DanielV01
Expert Alumni

I receive income from a lease of a small office building I own in which I am responsible (not the tenant) for all maintenance. Is this a Qualified Business Income?

It depends.  Most rental activities will still qualify for the QBI deduction, and your material participation in this activity will likely allow this rental to be Qualified Business Income.  (I'll provide an FAQ at the end that discusses this in a bit more detail, and will help guide you if your activity does qualify; if your situation is not clear, please comment). 

But it can be a bit tricky if you are an active participant in a business activity as a Specialized Service or Trade Business.  If the rental is made to your SSTB, then the rental activity is also SSTB income, which would mean that if you are over the thresholds your QBI discount can be phased out down to zero.  

A lot can be involved with this, and feel free to comment with further questions if you need more clarification.  Here is an FAQ to provide guidance on rental income for the purposes of the QBI deduction:  https://ttlc.intuit.com/replies/7122193

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1 Reply
DanielV01
Expert Alumni

I receive income from a lease of a small office building I own in which I am responsible (not the tenant) for all maintenance. Is this a Qualified Business Income?

It depends.  Most rental activities will still qualify for the QBI deduction, and your material participation in this activity will likely allow this rental to be Qualified Business Income.  (I'll provide an FAQ at the end that discusses this in a bit more detail, and will help guide you if your activity does qualify; if your situation is not clear, please comment). 

But it can be a bit tricky if you are an active participant in a business activity as a Specialized Service or Trade Business.  If the rental is made to your SSTB, then the rental activity is also SSTB income, which would mean that if you are over the thresholds your QBI discount can be phased out down to zero.  

A lot can be involved with this, and feel free to comment with further questions if you need more clarification.  Here is an FAQ to provide guidance on rental income for the purposes of the QBI deduction:  https://ttlc.intuit.com/replies/7122193

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

View solution in original post

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