IRS publication 527

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 tax

If 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.

-------

------------Qualified joint venture. If you and your spouse each materiallyparticipate (see Material participation , later) as the only membersof a jointly owned and operated real estate business, and you file ajoint return for the tax year, you can make a joint election to betreated as a qualified joint venture instead of a partnership. Thiselection, in most cases, will not increase the total tax owed on thejoint return, but it does give each of you credit for social securityearnings on which retirement benefits are based and for Medicarecoverage.

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.