Let’s start with a definition…
A triple-net lease requires the lessee to pay the landlord rent and take care of real estate taxes, building maintenance, and property-management costs.
If you use triple-net leases for your rental properties, you may be wondering if you’re eligible for the valuable Section 199A 20-percent deduction.
Our answer is an absolutely definite “maybe.”
Sorry for the “it-all-depends” answer, but there are several factors to consider as we’ll explain when you read my new article titled Tax Tips: Q&A: Do Triple-Net Leases Qualify for a 199A Deduction?
Three ways our fact-filled article can help you:
- We’ll tell you which properties qualify for the 20-percent deduction. Your rental qualifies for the Section 199A deduction if it is considered a trade or business under tax code Section 162. Or … you rent the property to a commonly-controlled trade or business. We’ll give you all the details when you read the full after-tax-reform article.
- We’ll explain the triple-net problem. Many triple-net lease rental activities will probably fail the “regular and continuous activity” test. We’ll tell you what these regulations are all about when you
- read the full after-tax-reform article.
- You’ll learn why there’s still hope. The IRS lists four factors to consider when determining if your rental activity is a trade or business. We’ll list them and explain why your rental activities may rise to the level of a trade or business. All will be explained when you read the full article.