All Forum Posts by: Brian Sohmers

Since I can get a better interest rate on my primary residence, it’s cost effective to max out the loan on my primary house and pay off loans on rentals but only if I can still deduct the interest as an expense for the rentals since I'm over the $750,000 limit on primary interest deductions. Can I deduct interest above the $750K as an expense against my rental income?

Thank you for your response! I have a net income and expect in aggregate to have a net income for the foreseeable future. It's true that  new property purchases typically generate a net loss for the first year, sometimes second for me, but when aggregating, I don't expect to have a net loss overall unless I have a really bad year and/or purchase make a very significant investment.

I own many SFH rentals and when preparing my 2020 taxes, learned about the 20% qualified business income (QBI) deduction. Yay! I think I need to use the aggregated business safe harbor in order to meet all requirements, namely the 250 service hour requirement, since I don't meet the 250 hours for each individual property but do meet it in aggregate. Does anyone else have experience using this safe harbor and am I interpreting it correctly?

Also, on Schedule B form 8995-A the IRS asks to "Provide a description of the aggregated trade or business and an explanation of the factors met that allow the aggregation in accordance with Regulations section 1.199A-4." Any advise on how to best answer this question is appreciated. Thank you in advance!