The Tax Cuts and Jobs Act includes a 20 percent deduction for sole proprietors and owners of S corporations and other business entities. This was designed to provide roughly the same rate cut provided to regular corporations.
It is unclear, however, whether owners of rental real estate will be able to claim the deduction.
This week, the National Association of Realtors® publicly called on the Treasury Department and Internal Revenue Service to treat all real property rental activity as eligible for the 20 percent deduction.
Text of the letter can be found here.
It reads: "Without the change discussed above, millions of individual taxpayers who earn rental income from real property would need to wade through voluminous and confusing references to tax authority to try to determine whether they believe2 they are eligible for the deduction."