3 Separate Rental Houses all reported under A on Sch E

[AZ-Tax]

Probably not a big deal but tax preparer who prepared previous returns, combined 2 separate rental houses both located in mid size city plus the 3rd rental located on a Farm under A on Sch E. The Farmland itself is cash rented and is reported as B on the Sch E. I asked the TP if these rentals have their own checking accts and TP replied no, all residential rentals plus Farmland use the same checking acct.

[David1980]

Sounds like the taxpayer may have made an election to treat the rental properties as one activity. This is usually done in order to meet the material participation requirements for a real estate professional. Without the election they would have to meet the material participation requirements for each separate rental individually.

Try TTB 7-10/7-11 for information.

[AZ-Tax]

Nope, Active Participation

Sounds like the taxpayer may have made an election to treat the rental properties as one activity. This is usually done in order to meet the material participation requirements for a real estate professional. Without the election they would have to meet the material participation requirements for each separate rental individually.

Try TTB 7-10/7-11 for information.

That also came to mind but the TP filed as "Active Participation".

[FEDUKE404]

Location location location

That also came to mind but the TP filed as "Active Participation".

One might be inclined to ask what was entered on Line 1a of their Schedule E ??

FE

[Burke]

Did he do two separate depreciation schedules for the rental residences? They would have to be different. And if he has suspended passive losses, they have to be allocated separately. Much clearer to handle separately on the Sche E.