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We had a question recently that of course the Intuit “Search” function could not find if the CEO’s life depended on it. It involved a rental property owned as “Tenants in Common” which apparently was filing a partnership return. This was perfectly appropriate although it wasn’t clear until about the third or fourth reply. The interest and taxes were already reflected on the Schedule K-1.
It just occurred to me today that to qualify for the Section 199A QBI deduction, a rental property with multiple owners must file as a partnership. So that’s probably being done more often than before the law familiarly known as TCJA.
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"to qualify for the Section 199A QBI deduction, a rental property with multiple owners must file as a partnership"
Where'd that come from?
AFAIK a rental needs to be a trade or business to qualify for the QBI deduction.
The more I know the more I don’t know.
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And the safe-harbor rules say, in effect, that "if you're really a trade or business, you'll be filing as a separate entity."
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@sjrcpa wrote:
"to qualify for the Section 199A QBI deduction, a rental property with multiple owners must file as a partnership"
Where'd that come from?
AFAIK a rental needs to be a trade or business to qualify for the QBI deduction.
If it is a Trade or Business, it would be on the 1065 (unless the owners were only husband-and-wife). Mere co-ownership of a rental doesn't need to be on a 1065 because it is not a "trade or business".
https://www.irs.gov/instructions/i1065#en_US_2021_publink11392vd0e339
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Who uses the safe harbor? I don't.
The more I know the more I don’t know.
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So you think these syndicated TICS, with professional property management, hundreds of owners and who knows how many commercial and residential properties, are not a trade or business and no QBI deduction? They don't file a 1065.
The more I know the more I don’t know.
