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Submitted By: someone
Answered: January 5, 2020 10:14 pm
Answered: January 5, 2020 10:14 pm
Is income from a sole proprietorship that holds rental real estate eligible for the 20%qualified business income deduction?
The qualified business income deduction applies only to a trade or business. Under an IRS-created safe harbor, a rental real estate activity may be treated as a trade or business for purposes of this deduction. Details of this safe harbor are in IRS Revenue Procedure 2019-38 (https://www.irs.gov/pub/irs-drop/rp-19-38.pdf).
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Tax Glossary
Adjusted basis
A statutory term describing the cost used to determine your profit or loss from a sale or exchange of property. It is generally your original cost, increased by capital improvements, and decreased by depreciation, depletion, and other capital write-offs.
