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Sec 199A Self-rental

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Level 1

I'm preparing an individual tax return on ProSeries for husband/wife 50/50 owners of an S corp.  The husband is the 100% owner of two single-member LLCs, each of which owns a property that is rented to the S corp. Reg Sec 1.199A-1(b)(14) provides that a self-rental can be treated as a trade or business for Sec 199A.  Is there an election statement or some form of disclosure for this?  Should I include a statement like the one required by the aggregation regs (Reg Sec 1.199A-4(c)(2))?  Does ProSeries include an Aggregation disclosure statement?  Thank you.

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Moderator
Moderator

When you are on the Schedule E Worksheet for ProSeries Self Rental is choice 7 under Property Type. This is up in the General Information right above the address of the rental.

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Employee
Employee

Treasury has made no mention of an election statement being required. Since the rental activity is treated as a trade or business by definition, rather than by election, no election statement applies.

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Level 1

OK, so all I need to do is check the Yes box for "Is this activity a qual T/B?" in the QBI Deduction Info section of the Sch E worksheet.  Correct?

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You should also mark in schedule E "SELF RENTAL"

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Level 1

Mort - Skokie ... Is that a Lacerte field?  I don't see a Self Rental box on the ProSeries Professional Sch E.  Thank you.

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Moderator
Moderator

When you are on the Schedule E Worksheet for ProSeries Self Rental is choice 7 under Property Type. This is up in the General Information right above the address of the rental.

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**Mark the post that answers your question by clicking on "Accept as solution"

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Level 1

Charlene - I see it, thank you!

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Level 3

I understood the self-rental provisions under Notice 2019-38 to EXCLUDE the QBI Deduction to a husband & wife that own commercial real estate rental and rents the building to an S-Corp that is 100% owned by the wife??  All other criteria for the safe harbor is satisfied, EXCEPT the self-rental provision?  Can someone please chime in on this?  Thank you.

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