ljr
Level 8
09-21-2023
07:30 AM
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The question to determine if it a qualified trade or business is the same for 2 rental properties as it is for 1 rental property. More than likely the answer is no if they just own and rent out a property or two. Is it in their own names or did they create an LLC or S corp to hold the properties. How much time do they spend "managing" the properties? You have to see if it rises to the level of a "business". Active or Material participation. Do they spend more than 750 hours per year in which they materially participate? if no, then then it would be a no. Most rental properties generate a loss so the QBI would not help their tax return.