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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29528
Experience:  Taxes, Immigration, Labor Relations
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Client has rental properties in named LLC (s) the schedule

Customer Question

Client has rental properties in named LLC (s) the schedule E wouldn't incur self employment tax, however if income is reports thru the C and is registered as such with the county or city what would be the best treatment !
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: Qualifiies as active rental agent 750 plus hours etc
JA: OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Accountant about your situation and then connect you two.
Submitted: 12 months ago.
Category: Tax
Expert:  Lev replied 12 months ago.
Rental activity is reported on schedule E and is NOT subject to self-employment tax.That is regardless how many hours the taxpayer spent for that activity.
Expert:  Lev replied 11 months ago.
See the law section herehttps://www.law.cornell.edu/uscode/text/26/469(c) Passive activity definedFor purposes of this section—(1) In generalThe term “passive activity” means any activity—(A) which involves the conduct of any trade or business, and(B) in which the taxpayer does not materially participate.(2) Passive activity includes any rental activityExcept as provided in paragraph (7), the term “passive activity” includes any rental activity....(4) Material participation not required for paragraphs (2) and (3)Paragraphs (2) and (3) shall be applied without regard to whether or not the taxpayer materially participates in the activity..Let me kno wif you need any help.