IRS 199A deduction
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IRS 199A deduction (by Marv [IL]) Oct 9, 2018 5:48 AM
       IRS 199A deduction (by Plenty [MO]) Oct 9, 2018 6:44 AM
       IRS 199A deduction (by John... [MI]) Oct 9, 2018 8:02 AM
       IRS 199A deduction (by AllyM [NJ]) Oct 9, 2018 8:24 AM
       IRS 199A deduction (by Scott [IN]) Oct 9, 2018 10:36 AM
       IRS 199A deduction (by Don I [MO]) Oct 9, 2018 11:39 AM
       IRS 199A deduction (by John... [MI]) Oct 9, 2018 11:46 AM
       IRS 199A deduction (by Marv [IL]) Oct 10, 2018 5:28 AM
       IRS 199A deduction (by Kevin [PA]) Oct 10, 2018 4:20 PM
       IRS 199A deduction (by WMH [NC]) Oct 11, 2018 7:27 AM

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IRS 199A deduction (by Marv [IL]) Posted on: Oct 9, 2018 5:48 AM
Message:

It looks like I spoke too soon in my previous post regarding this topic. As it stands now, in order to deduct 20% of your profits from rental income, your rental investment must rise to the level of being a business.

This is very vague but I would say most rentals would not rise to this level and thus not qualify for the 20% deduction. This is contrary to 95% of what has been reported on this board.

--173.15.xx.xxx




IRS 199A deduction (by Plenty [MO]) Posted on: Oct 9, 2018 6:44 AM
Message:

I would think just to opposite. If you collect money from rentals and claim expenses .. thats a business...Why do you think it would not raise up to be a business? --99.203.xx.xxx




IRS 199A deduction (by John... [MI]) Posted on: Oct 9, 2018 8:02 AM
Message:

Because being a "business" means more than that to the IRS.

This is the same reason that people argue about whether or not we have to issue 1099-MISC every year.

When we had a discussion with John Hyre here back in January, I said this:

"When it comes to the new tax laws, everyone wants to argue that they are a business according to the IRS.

When it comes to filing 1099-MISC forms, everyone wants to argue that they are not a business according to the IRS."

Hyre seemed to agree with me on that...

- John...

--24.180.xxx.xxx




IRS 199A deduction (by AllyM [NJ]) Posted on: Oct 9, 2018 8:24 AM
Message:

A small business had to be making money after three years. If it's not. the IRS considers it a hobby not a business. However, there may be a different rule for rentals since this business is very different. --73.178.xxx.xx




IRS 199A deduction (by Scott [IN]) Posted on: Oct 9, 2018 10:36 AM
Message:

My lawyer and accountant both said I was not a business. Lawyer said that I was just a guy with some rental properties. I wish I had asked for more specifics. At the time I needed to know because in my area, only non-businesses can represent themselves in small claims court. A business is required to be represented by a lawyer.

--108.219.xx.xxx




IRS 199A deduction (by Don I [MO]) Posted on: Oct 9, 2018 11:39 AM
Message:

Scott,

I'm pretty certain that refers more to whether or not you've created a BUSINESS ENTITY (LLC, LLP, Corp etc). If your business is one of these entities, then the business is NOT YOU. Thus you would not be able to represent the business unless you are an attorney. --174.234.xxx.xx




IRS 199A deduction (by John... [MI]) Posted on: Oct 9, 2018 11:46 AM
Message:

Indeed -- the legal representation status of a rental business would very likely NOT be based on the IRS classification.

- John...

--24.180.xxx.xxx




IRS 199A deduction (by Marv [IL]) Posted on: Oct 10, 2018 5:28 AM
Message:

The legal entity will not entitle you to business status. Nor will being a real estate professional.

One thing for sure, If you want to attain business status, you will need to fill out 1099s for subs. I guess we need more IRS clarification on the clarification. --173.15.xx.xxx




IRS 199A deduction (by Kevin [PA]) Posted on: Oct 10, 2018 4:20 PM
Message:

Rental property income is taxed as "passive income" thats why its not considered a trade or business. You want to keep it this way. Believe me. Otherwise you are paying additional taxes like local and self employment tax. Remember; in life two things are certain. Death and taxes! --174.59.xxx.xx




IRS 199A deduction (by WMH [NC]) Posted on: Oct 11, 2018 7:27 AM
Message:

I send 1099s because it says, right on the Schedule E, "Did you send any required 1099's?" or something like that.

That's on Schedule E, the only form for rental property income and expenses. Why ask the question if we aren't supposed to do it? It doesn't ask, "Are you a business?" --50.82.xxx.xx



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