@Terry53029 and @TaxGuyBill,   

Thank you, I appreciate you reaching out on this.

And, I apologize for the confusion I created with my summary, I should have just said this:

H/W own the land, and they incurred approx. $1.5 million of personal debt to construct Turkey Houses & purchase necessary Turkey House Equipment.  Upon completion, a thriving Turkey farming business was started (which was being reported on dual Schs F on t/p’s F1040).  By Year 3 or 4, t/p’s Attorney said go LLC Partnership, and they did (2018 was mostly Sch F and little bit LLC, and no discussion of Sch E).  So, for 2019, what’s being rented to the LLC by the T/Ps are the Turkey Houses and Equipment necessary for them to operate and generate income, and the land on which they sit.  And the T/Ps are the 2 sole S/Hs, and the sole owner/operator/workers of the business, the LLC, and, in my mind, I thought this qualified as one of the exceptions to the PAL rules, but I couldn’t find anything about it in the IRS guidance, so I reached out here.  Now, it seems pretty clear, I was just wrong!!  lol  

However, seeing as I was so wrong about that, mind if I impose on you for one more small question?  I was the one that expressed concern over the LLC taking a deduction for mortgage interest that was being reported to the IRS under the t/p’s SS#, and out of that grew this Sch E situation, since the t/p & s/p were no longer going to have the Schs F. 

So, Was I wrong here too?  Would it have been acceptable to report it on the LLC’s t/r?  I reached out to a friend who’s an attorney, and he agreed with me, so I never consulted this board.  H&W are jointly liable for all the debt, and they’re 50-50 partners in the LLC Partnership.

Thanks in advance for your time and consideration.  I hope I haven't created any further confusion.