DM26
Level 3

Get your taxes done using TurboTax

I already own H&R Block and they do not support.  I previously contacted support for TaxAct and am still waiting on an answer. 

A further option is freefillableforms.com which is the IRS's website that allows filling in the forms and e-filing.  If someone already has their return prepared through TurboTax or other software they can fill-in all forms on this website and then e-file.  They have forms 8995 as well as Schedule A, B, C & D (form 8995-A).  They don't seem to have a safe harbor statement but they do have form 8275 which is allows a disclosure statement where I believe you can add in the Safe Harbor affirmation statement. 

Form 8275, Disclosure Statement, is used to disclose items or tax positions that aren’t otherwise adequately disclosed on a tax return.

 

One thing that is confusing is why these software programs can't just accept the Rental Enterprise Safe Harbor statement without a signature.  This way there is no need to have to separately attach it.  It is my understanding that the requirement to sign the Safe Harbor statement was eliminated with Rev. Proc. 2019-38. Below is a summary I found online regarding the changes made with Rev. Proc. 2019-38.

 

The determination as to whether a rental real estate enterprise rises to the level of a trade or business under section 162 is difficult, and in many cases unclear. But, it is critical when assessing whether rental real estate activities will qualify for the new 20% section 199A deduction.  

To address these uncertainties, the IRS previously released Notice 2019-07, which provided a proposed safe harbor under which a rental real estate enterprise would qualify as a trade or business solely for purposes of section 199A. The IRS finalized this guidance on Sept. 24, 2019 with the release of Rev. Proc. 2019-38. While substantially similar to Notice 2019-07, the new revenue procedure does deviate in some notable areas

  1. Performance of 250 or more hours of rental services – for a rental real estate enterprise in existence for at least four years, at least 250 hours of rental services must have been performed annually in any three of the five preceding tax years. For enterprises that have been in existence less than four years, the hour requirement must be satisfied in the tax year under consideration.
  2. Triple net leases – the safe harbor is not available to triple net lease arrangements. Under the new guidance, a triple net lease is defined to include a lease that requires the tenant to pay taxes, fees and insurance and to pay for maintenance activities, in addition to rent and utilities. The previous guidance defined triple net leases in a similar manner, but referenced lease agreements where the tenant was responsible for maintenance activities. The revised guidance clarifies that the key factor is who pays for those activities.
  3. Maintenance of separate books and records – for each rental real estate enterprise, the enterprise must maintain separate books and records. If an enterprise consists of more than one property, this requirement may be satisfied if books and records are maintained for each property and are subsequently consolidated.
  4. Maintenance of contemporaneous records of rental activities – the enterprise must maintain contemporaneous records documenting the hours, description and dates of all services performed, as well as who performed the services. This requirement is now applicable to tax years beginning after Dec. 31, 2019.
  5. Attachment to the taxpayer’s timely filed tax return – a taxpayer relying on Rev. Proc. 2019-38 must attach a statement to the return that describes all rental real estate properties included in each rental real estate enterprise for each taxable year in which the taxpayer relies on the safe harbor.
  6. Taxpayer signature - The revenue procedure eliminates the previous requirement that the taxpayer sign, under penalty of perjury, a statement confirming that all requirements of the safe harbor have been satisfied.