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Does sale of Sch E rental property qualify for 199A deduction . is it eligible for 199A

Tom212
Level 1
 
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4 Comments 4
sjrcpa
Level 15

If the activity rises to the level of a trade or business.


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Tom212
Level 1

retired, single lady who owns a Sch E rental property.  She collects the rents, gets maintenace people as needed.  It is not a business, except that she rents it and does a Sche E.   So does it qualify for the 199A

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sjrcpa
Level 15

 Not for me to decide. It depends on the facts and circumstances. There are mountains of commentary on this. Start researching.

You didn't have any of these for 2018?


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linette
Level 5

Where others maybe harsh in responding this really is something that you need to research not ask here.

There is a safe harbor rule and other resources that you can easily find to help make this determination but I think it is a determination that you and your client need to make.

It is the clients responsibility to keep documentation to prove that the rental is being operated as a business if the deduction is taken.

I have heard preparers say that rentals do not qualify.  I think that may come from they don't want to do the work to try to prove they do qualify.

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