topic Do Rental properties qualify for QBI? in Investors & landlords

Do Rental properties qualify for QBI?

maureenkuhl — Thu, 06 Jun 2019 06:59:36 GMT

Either Sch E or pass-through rental income

Even if your activity does not meet the requirements belo...

KittyM — Thu, 06 Jun 2019 06:59:38 GMT

Even if your activity does not meet the requirements below, you make take the deduction as long as your activity is considered a "trade or business" under IRS rules. Please see the linked TurboTax FAQ for more information on the IRS Code Section 162 definition of a trade or business.

Because this deduction is new and many people are not certain if they are eligible, the IRS has created the "Conventional Rental IRS Notice 2019-07 Safe Harbor Test" below. You are not required to meet these tests, but if you do, you will definitely qualify to take the deduction.

1) On a regular basis, does the taxpayer consult with advisors, negotiate and execute leases, consult with or act as property managers or personally maintain, manage or supervise the rental activity of the above property, and does this activity continue throughout the year?

2) Does the taxpayer, employees, agents or independent contractor of the taxpayer spend at least 250 hours annually (per property) dealing with the advisors, managers or personally with tenants, repair or maintenance companies or on-site issues?

3) Does the taxpayer maintain contemporaneous (i.e. "at the time of occurance") written calendar time records to prove the above regular, continuous activity?

In many cases, after depreciation, residential rentals operate at a loss, so the QBI deduction may not show up this year on your return, but will be carried forward for future use.

Edited 3.25.2018 | 10:00 a.m.

https://ttlc.intuit.com/questions/4557531-can-i-get-the-qbi-deduction-on-rental-income

Can an owner that manages his rental property meet this h...

QUEST5 — Thu, 06 Jun 2019 06:59:39 GMT

Can an owner that manages his rental property meet this hourly requirement by simply being responsible for managing his rental? If the answer is yes, can the owner also meet this hourly requirement if he uses a management company for his rental and is responsible for all significant decisions for the property (such as approval of the the tenant, repairs, maintenance, etc)?

please tell me step by step on how to claim this qbi for...

boyanghong — Thu, 06 Jun 2019 06:59:41 GMT

please tell me step by step on how to claim this qbi for rental income, at Turbo Tax Primer. Thanks.

Re: Even if your activity does not meet the requirements belo...

mconner — Tue, 18 Feb 2020 15:41:31 GMT

@KittyM This doesn't appear to reflect IRS rp-19-38, if you have say 3 single family houses, they can all be grouped as one "real estate enterprise" and therefore only require 250 hrs between all of them. I think you need to remove the parenthesis that reads "per property".