If you receive rental income where you are not actively participating is it considered to be non-business income?
- posted
10 years ago
If you receive rental income where you are not actively participating is it considered to be non-business income?
In what context?
Should have read your "Subject". Rental income is included on the Form
1045 Schedule A Line 1 for purposes of computing an NOL. No adjustments are made on the Schedule A Lines 6 and 7.Your rental income would be net investment income for purposes of the Medicare Contribution Tax (3.8%).
I realize that the instructions for form 1045 don't distinguish rental income from active participation from rental income from non-active participation. The reason that I brought up the question is that I have this old article from 2009 that categorizes rental income from non-active participation as non-business income. However, nobody else seems to be making this distinction? I was wondering if anybody has any deeper insight into the issue.
The only insight I can add is that I believe that rental losses that fall into the $25K allowable passive loss are allowed for an NOL.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.