crichardson552
Level 2
12-07-2019
03:40 AM
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Have talked to IRS and they said the rental of the lot was investment income and
EIC was denied. Intuit has the EIC included in the return. Refund was taken off
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Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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Where did the lot rental get included? On Sch E?
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crichardson552
Level 2
12-07-2019
03:40 AM
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Schedule e
Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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I feel like I saw someone in the Facebook ProSeries group a few weeks ago that had a similar situation, the software wasn't counting rental income as investment income and IRS disallowed their EIC.
I don't think Ive had any clients with rental income that also qualify for EIC....I'll be sure to be on the lookout ofr that now though.
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I don't think Ive had any clients with rental income that also qualify for EIC....I'll be sure to be on the lookout ofr that now though.
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Ernie
Level 9
12-07-2019
03:40 AM
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Is this a problem that should be reported to development?
Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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That's what Im wondering too....
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Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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I cant even think of a client I might have that would fall into this situation for me to go look at their return, without having to make a bunch of "what if" changes to it.
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Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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OK, I found one Gave 6000 in W2 and 3900 on Sch E, single family home...no EIC computed.
BUT if I switch the Sch E to be LAND, not a single family home, then EIC does compute.
(self rental property type also allows EIC)
I guess the question is...is that correct?
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BUT if I switch the Sch E to be LAND, not a single family home, then EIC does compute.
(self rental property type also allows EIC)
I guess the question is...is that correct?
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abctax55
Level 15
12-07-2019
03:40 AM
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Do you have it tagged as land? Land rentals get treated differently, for some reason. Lacerte gives the ability to select the type of rental, and I remember some diagnostics when "land" is selected.
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TaxGuyBill
Level 15
12-07-2019
03:40 AM
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Even then, it should be disqualified investment income.
§32 disqualifies (1) "rents or royalties not derived in the ordinary course of a trade or business", AND (2) passive activity income.
Rental of land is non-passive, so it would avoid that. But it would still likely be "rents or royalties not derived in the ordinary course of a trade or business".
§32 disqualifies (1) "rents or royalties not derived in the ordinary course of a trade or business", AND (2) passive activity income.
Rental of land is non-passive, so it would avoid that. But it would still likely be "rents or royalties not derived in the ordinary course of a trade or business".
abctax55
Level 15
12-07-2019
03:40 AM
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I vaguely remember a thread on this several years ago.
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Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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But if the rental qualifies for QBI as a trade or business, would EIC still consider it investment income?
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abctax55
Level 15
12-07-2019
03:40 AM
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Arggggggghhhhh - don't go there 🙂
I wouldn't think it would matter; a rental deemed a ToB for 199A doesn't trigger SE tax.
BUT - who the hell knows right now?????
I wouldn't think it would matter; a rental deemed a ToB for 199A doesn't trigger SE tax.
BUT - who the hell knows right now?????
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Just-Lisa-Now-
Level 15
12-07-2019
03:40 AM
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LOL
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TaxGuyBill
Level 15
12-07-2019
03:40 AM
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Hypothetically, if it qualified as a Trade or Business it would not be investment income.
However, I don't see how rental of LAND can have 'regular and continuous' activity to rise to the level of a Trade or Business.
However, I don't see how rental of LAND can have 'regular and continuous' activity to rise to the level of a Trade or Business.
abctax55
Level 15
12-07-2019
03:40 AM
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From three years ago, FWIW.
https://accountants-community.intuit.com/questions/1356896-land-rent-and-eic
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TaxLady8
Level 1
04-22-2021
04:38 PM
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I am researching if land rent is part of investment income because of eic as well. I cannot get this link to go anywhere. Do you have any recollection what it was about. I know that is asking a lot to remember that long ago.