Question

Decreased tax burden when Rental income is higher.

Forum|Forum|3 years ago
February 24, 2023
1 reply
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My current 2022 TurboTax preliminary tax return includes personal income, business income and rental income. When I make adjustments to the income or costs of my rental such that the net income increases, my tax burden decreases. This is counter-intuitive. Is there an explanation for this situation?

M

mglauner

If your Rental Income increases, your QBI Deduction may also increase, reducing your tax burden. Since we can't see your return in this forum, this is just an 'off the top' guess.

If you're using TurboTax Online and want to switch to TurboTax Desktop (where you can view/edit forms directly, as well as 'drill down' to data source), here's How to Switch from TurboTax Online to Desktop. Since you have both Business and Rental Income, this may be beneficial to you.

Here's more info on the Qualified Business Income (QBI) Deduction.