Can anybody help me understand the following part from IRS Publication
527?What I get are:
1] When selecting Qualified joint venture, both spouses can get credit fro social security & medicare 2] The rental income is NOT subject to self-employment taxIf all income a couple has is from rental and they select qualified joint venture, will this mean they pay no self-employment tax but still get social security & medicare credit?
This sounds a bit counter-intuitive. So I guess my understanding of the IRS text is wrong, can anybody help me to understand? Thanks.
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If you make this election, you must report rental real estate income on Schedule E. You will not be required to file Form 1065 for any year the election is in effect. Rental real estate income generally is not included in net earnings from self-employment subject to self- employment tax and generally is subject to the passive loss limitation rules.