Is a Triple Net Lease to a C Corporation Qualified Business Income?

Consider this scenario…

• You operate your professional practice as a C corporation
• Your spouse rents your office to your C corporation on a triple net lease

The important question you need to consider is, does your spouse qualify for the Section 199A deduction on the rental income?

If this scenario applies to your situation and you’re looking for answers to the Section 199A deduction questions I posed above, don’t miss my new article titled Tax Tips: Q&A: Is a Triple Net Lease to a C Corporation QBI?

Three ways our fact-filled article can help you:

1. We’ll provide you with the “big picture.” Under the final regulations, your rental activity can get the Section 199A deduction in one of three ways. We’ll tell you what they are, and also explain why your wife’s rental income won’t qualify for the deduction. You’ll get a full explanation of the bad news when you read the full article.
2. We’ll explain a planning strategy you and your spouse can use to come out winners. If you operate your professional practice as an S corporation, your wife’s rental automatically qualifies for the Section 199A deduction if your professional practice also qualifies. There are taxable income limitations that may be a problem but making an S corporation election is one approach you should definitely consider. You’ll get all the details when you read the full article.
3. We’ll tell you about another way to qualify for the deduction. You should consider eliminating the triple net lease. If your wife have regular and continuous involvement with the rental activity, the rental likely could qualify as a tax code Section 162 trade or business. This will permit you to claim the Section 199A tax deduction on the net rental income. You’ll get the whole story when you read the full article.