Regarding the rental property, remember that you may have an easier way to address the "does property create QBI?" question... you can use the Section 162 standard.

The final regs have a pretty darn good discussion of this topic. But the basic rule (in case someone hasn't yet begun their research) is taxpayer needs to show regularity, continuity and a profit motive. That may actually be a pretty easy standard to apply if one does a bit of research.

I also did a pretty long blog post about this here:

https://evergreensmallbusiness.com/section-199a-rental-property-trade-or-business-definition/

P.S. I think there's a related thorny issue here too. What about someone with properties generating qualified business losses. That's supposed to be tracked, too, and carried forward.

Someone who talks a lot about tax (maybe Tony Nitti?) proposed (half joking I assume) that taxpayers might want to intentionally fail the safe harbor rules in order to avoid having to accumulate and later take the hit for negative QBI. Would be interesting to see what pracititioner consense on that "gambit" is...

View solution in original post

0 Cheers