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Does residential rental property qualify for qbi deduction

fredr
Level 3

Does a residential rental that owner manages eligible for the 20%QBI deduction?

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George4Tacks
Level 15

Maybe? There is much discussion. https://www.caltax.com/news/flash-email/2018-23-irc-%C2%A7199a-information-released-in-draft-publica... is a place to start. While you are there, sign up for their Flash E-mail. Very informative, even if you don't do CA returns. 


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George4Tacks
Level 15

Maybe? There is much discussion. https://www.caltax.com/news/flash-email/2018-23-irc-%C2%A7199a-information-released-in-draft-publica... is a place to start. While you are there, sign up for their Flash E-mail. Very informative, even if you don't do CA returns. 


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Terry53029
Level 12
Level 12
the latest info I have read says, yes. With the latest update for ProSeries it does give the QBI deduction for schedule E
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IRonMaN
Level 15
George's "maybe" is correct.  It really depends on the amount of the owner's involvement rather than a blanket "yes" for rentals in general.

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George4Tacks
Level 15
I have a rental and I believe that the scope of MY ACTIVITIES with it are SO EXTENSIVE as to give rise to qualify for QBI.  So, for me the answer is yes.
@fredr needs to decided, based on a thorough set of open end questions to his client, whether that property qualifies.

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acarlsen
Level 1
It looks like there may be a 250 hour minimum of rental services to qualify for the QBI. See Rev Notice 2019-7 https://www.irs.gov/pub/irs-drop/n-19-07.pdf  And a shorter explanation:
 https://www.kitces.com/blog/irs-notice-2019-07-199a-qbi-deduction-250-hours-safe-harbor-rental-real-...
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sjrcpa
Level 15
That's a safe harbor. There are other ways to qualify.

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abctax55
Level 15

One excellent commentator's take on it:

https://img1.wsimg.com/blobby/go/310b78c2-6a3e-4922-acb3-709b44966191/downloads/1cj1au49p_579493.pdf

There is NO blanket answer of yes/no.  You as the tax pro have to evaluate the facts & circumstances of each one of your clients.

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