IRS Publishes Guidance On The 20% Pass-Through

[FIREd_2015]

https://www.forbes.com/sites/anthon...duction-putting-it-all-together/#71034bdd9f0b

"...In Revenue Procedure 2019-7, the IRS offered a safe harbor providing that a rental activity (or multiple rentals if the taxpayer chooses to treat them as a combined enterprise, with the understanding that commercial properties cannot be grouped with residential properties) will rise to the level of a Section 162 trade or business if:

• separate books and records are maintained for each rental activity (or the combined enterprise if grouped together),
• 250 hours or more of "rental services" are performed per year for the activity (or combined enterprise), and
• the taxpayer maintains contemporaneous records, including time reports or similar documents, regarding 1) hours of all services performed, 2) description of all services performed, 3) dates on which such services are performed, and 4) who performed the services.

For these purposes, rental services include advertising to rent, negotiating and executing leases, verifying tenant applications, collection of rent, daily operation and maintenance, management of the real estate, purchase of materials, and supervision of employees and independent contractors..."

Found another discussion on a RE forum:

https://www.biggerpockets.com/forum...ll-your-rentals-qualify-for-199a-new-guidance

"...A rental real estate enterprise that satisfies the proposed safe harbor may be treated as a trade or business solely for purposes of section 199A and such satisfaction does not necessarily determine whether the rental real estate activity is a section 162 trade or business. Likewise, failure to meet the proposed safe harbor would not necessarily preclude rental real estate activities from being a section 162 trade or business..."