--- title: Will Your Rental Real Estate Continue to Qualify for the New 20% Tax Deduction? description: CRR's Brian Shoer discusses the impacts of the new 20% QBI deduction on rental real estate enterprises, and provides tips for ensuring that you qualify for the deduction in 2019 and beyond. image: https://www.crradvisors.com/hubfs/AdobeStock_95775043.jpeg --- [Skip to content](https://www.crradvisors.com/blog/will-your-rental-real-estate-continue-to-qualify-for-the-new-20-tax-deduction#main-content) [![CRR](https://www.crradvisors.com/hubfs/CRR.svg)Homepage](https://www.crradvisors.com) - [Home](https://www.crradvisors.com) - [Services](https://www.crradvisors.com/services) - [Audit & Assurance](https://www.crradvisors.com/services/accounting-auditing) - [Business Valuation](https://www.crradvisors.com/business-valuation) - [Client Accounting + Advisory Services](https://www.crradvisors.com/caas) - [Private Client Services](https://www.crradvisors.com/private-client-services) - [Tax for Businesses](https://www.crradvisors.com/tax-services-business) - [Tax for Individuals](https://www.crradvisors.com/tax-services-individual) - [Transaction Advisory](https://www.crradvisors.com/transaction-advisory-services) - [Industries](https://www.crradvisors.com/industries) - [Blog](https://www.crradvisors.com/blog) - [About Us](https://www.crradvisors.com/about-us) - [Team & Careers](https://www.crradvisors.com/about-us) - [CRR Charitable Foundation](https://www.crradvisors.com/crr-charitable-foundation) - [Contact](https://www.crradvisors.com/contact-us) - [Client Tools](https://www.crradvisors.com/client-portal) - [Home](https://www.crradvisors.com) - [Services](https://www.crradvisors.com/services) - [Audit & Assurance](https://www.crradvisors.com/services/accounting-auditing) - [Business Valuation](https://www.crradvisors.com/business-valuation) - [Client Accounting + Advisory Services](https://www.crradvisors.com/caas) - [Private Client Services](https://www.crradvisors.com/private-client-services) - [Tax for Businesses](https://www.crradvisors.com/tax-services-business) - [Tax for Individuals](https://www.crradvisors.com/tax-services-individual) - [Transaction Advisory](https://www.crradvisors.com/transaction-advisory-services) - [Industries](https://www.crradvisors.com/industries) - [Blog](https://www.crradvisors.com/blog) - [About Us](https://www.crradvisors.com/about-us) - [Team & Careers](https://www.crradvisors.com/about-us) - [CRR Charitable Foundation](https://www.crradvisors.com/crr-charitable-foundation) - [Contact](https://www.crradvisors.com/contact-us) - [Client Tools](https://www.crradvisors.com/client-portal) ![AdobeStock\_95775043](https://www.crradvisors.com/hs-fs/hubfs/AdobeStock_95775043.jpeg?width=5616&height=3744&name=AdobeStock_95775043.jpeg) Tax Business Advisory # Will Your Rental Real Estate Continue to Qualify for the New 20% Tax Deduction? ![Brian Shoer](https://www.crradvisors.com/hs-fs/hubfs/Images/Company_Photos/Headshots/Shoer_Brian.jpg?width=48&height=48&name=Shoer_Brian.jpg) Brian Shoer March 5, 2019 As you may be aware, the IRS recently provided a safe harbor to determine when a rental real estate enterprise will qualify as a trade or business, and thus able to receive the 20% Qualified Business Income (QBI) tax deduction. This IRS notice states that a rental enterprise will be treated as a qualifying trade or business if the following three requirements are met: - Separate books and records are maintained to reflect income and expenses for each rental real estate enterprise; - 250 or more hours of rental services are performed with respect to the enterprise in either three of the most recent five tax years, or all tax years if the enterprise is under five years old; and - The taxpayer maintains contemporaneous records, including time reports, logs, or similar documents, regarding the following: (i) hours of all services performed; (ii) description of all services performed; (iii) dates on which such services were performed; and (iv) who performed the services. This requirement does not apply to taxable years beginning prior to January 1, 2019. The active requirement of 250 hours is roughly one hour per day for every Monday through Friday business day of the year. That's not too tough of a hurdle, particularly since specific rental services include (a) advertising to rent or lease the real estate; (b) negotiating and executing leases; (c) verifying information contained in prospective tenant applications; (d) collection of rent; (e) daily operation, maintenance, and repair of the property; (f) management of the real estate; (g) purchase of materials; and (h) supervision of employees and independent contractors. Importantly, these rental services don't have to be performed solely by owners—time spent by employees, agents, and/or independent contractors counts toward the 250 hours. Even better, the requirement to maintain contemporaneous records does not apply to the 2018 tax year. Great news right? Yes, it is—for 2018. But right now, we are well into 2019—and contemporaneous records are required. **Contemporaneous means real-time, detailed documentation of what services are being performed as they are happening**—not a hastily produced list put together months or years later when the IRS comes knocking. So, is your rental services record current? If not, make it a priority today, so that the 20% QBI tax deduction your rental real estate enjoys in 2018 will still be available for 2019 and beyond.  If you would like help creating your customized rental services log, or have any questions at all, please leave  comment below, or contact me directly. I am more than happy to help! ## Share this post [mailto:https%3A%2F%2Fwww.crradvisors.com%2Fblog%2Fwill-your-rental-real-estate-continue-to-qualify-for-the-new-20-tax-deduction](mailto:https%3A%2F%2Fwww.crradvisors.com%2Fblog%2Fwill-your-rental-real-estate-continue-to-qualify-for-the-new-20-tax-deduction) ## Keep reading ### [![](https://www.crradvisors.com/hs-fs/hubfs/AdobeStock_808994683.jpeg?width=4823&height=2412&name=AdobeStock_808994683.jpeg) Transaction Advisory Banks Banking What the SBA's New Quality of Earnings Rule Means for Your Next Deal](https://www.crradvisors.com/blog/what-the-sbas-new-quality-of-earnings-rule-means-for-your-next-deal) ### [![Staffing agency employees having a team meeting](https://www.crradvisors.com/hs-fs/hubfs/AdobeStock_1876259626.jpeg?width=7936&height=5291&name=AdobeStock_1876259626.jpeg) Staffing Staffing Series Week 4: What Staffing Agency Owners Should Know About the Work Opportunity Tax Credit (WOTC)](https://www.crradvisors.com/blog/staffing-series-week-4-what-staffing-agency-owners-should-know-about-the-work-opportunity-tax-credit-wotc) [![CRR](https://www.crradvisors.com/hubfs/CRR.svg "CRR")](https://www.crradvisors.com) *"CRR" is the brand name under which CRR, LLP and Bridgepoint Alliance, LLC, doing business as CRR Advisors, offer professional services to its respective clients in an alternative practice structure in accordance with the AICPA Code of Professional Conduct and applicable laws, regulations, and professional standards. CRR, LLP is a licensed independent CPA firm that delivers attest services to its clients. CRR Advisors provides tax business consulting, and other non-attest services to their clients. Although it may employ CPAs, Bridgepoint Alliance, LLC is not a licensed CPA firm. The use of the terms “our firm,” “we,” and “us,” and similar language, may refer to CRR, LLP and CRR Advisors as it operates in its alternative practice structure.*       - [Home](https://www.crradvisors.com) - [Services](https://www.crradvisors.com/services) - [Industries](https://www.crradvisors.com/industries) - [Blog](https://www.crradvisors.com/blog) - [About Us](https://www.crradvisors.com/about-us) - [Contact](https://www.crradvisors.com/contact-us) - [Client Tools](https://www.crradvisors.com/client-portal) --- © 2025 CRR, LLP. All rights reserved.