Why are you hung up on material participation? It's not a concept that is relevant to Sch C, whereas §162 and §183 are.
If the activity rises to the level of §162 trade or business and is not an SSTB, notwithstanding the exception based on the taxpayer's taxable income, it is a qualified trade or business for purposes of §199A and eligible for QBI.
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Still an AllStar
