Form 8825 Rental real estate income and expenses of a Partnership or an S Corporation

1-100 Engagement set-up

Review the client's trial balance to determine whether there are rental income or expense accounts that should be reported on Form 8825. If applicable, select Yes for Does the trial balance contain rental income/expense accounts to be reported on Form 8825? in 1-100 Engagement set-up.

When Yes is selected, a property information table appears to document the details of each rental property. Up to 40 properties are currently supported. Ensure that each property is listed in a separate row.

  • Property ID: Automatically generated as new rows are added.

  • Property Name: Used to distinguish properties — it's recommended to enter the property's address or another unique identifier.

Once all property information is entered, select Update engagement content to finalize the setup. Verify all entries carefully before updating as the property information cannot be modified afterward. (This limitation will be removed in a subsequent release.)

1-560/1-565/1-570 Tax groups

The Tax groups forms are automatically updated to include the default Form 8825 tax groups.

  • You may create custom tax groups under the existing Form 8825 group hierarchy if needed.

  • These custom groups can be used to reflect unique client circumstances or property-specific allocations.

Refer to Tax groups for additional information on tax group management and customization.

1-550 Tax groups assignment

When Form 8825 tax groups are used, a new Property column is displayed in the 1-550 Tax groups assignment form.

  • The Property picklist values correspond to the properties documented in 1-100 Engagement set-up.

  • Each account assigned to a Form 8825 tax group must also be linked to the appropriate property.

This linkage ensures that income and expense items are accurately attributed to each property for reporting on Form 8825.

Tax adjustments

When recording tax adjustments involving Form 8825 tax groups, you must also select the associated property in the Property column.

Tax adjustments recorded to Form 8825 tax groups can be used for several purposes, including:

  • Allocating balances from client trial balance accounts that have not yet been separated between Income and Deductions (Page 1) and Form 8825.

  • Performing reallocations between multiple rental properties.

Tax reconciliation

The Tax reconciliation forms will be updated in a subsequent release to fully support Form 8825 tax groups. Once implemented, balances and adjustments tied to Form 8825 properties will be automatically reflected in the tax reconciliation forms.