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2024 Instructions for Schedule E
Use Schedule E (Form 1040) to report income or loss from rental real estate, royalties,
Supplemental partnerships, S corporations, estates, trusts, and residual interests in REMICs.
You can attach your own schedule(s) to report income or loss from any of these
Income and Loss sources. Use the same format as on Schedule E.
Enter separately on Schedule E the total income and the total loss for each part. En-
close loss figures in (parentheses).

Section references are to the Internal Revenue Code unless found in the Shareholder’s Instructions for Schedule K-1 (Form
otherwise noted. 1120-S).
Future Developments
For the latest information about developments related to Sched- General Instructions
ule E (Form 1040) and its instructions, such as legislation enac-
ted after they were published, go to IRS.gov/ScheduleE. Other Schedules and Forms You May Have
To File
• Schedule A (Form 1040) to deduct interest, taxes, and
casualty losses not related to your business.
What's New Form 461 to report an excess business loss.
•
Standard mileage rate. The standard mileage rate for miles • Form 941 to report the employer share and employee
driven in connection with your rental activities increased to 67 share of social security tax and Medicare tax, withheld federal
cents a mile for 2024. income tax, and, if applicable, withheld Additional Medicare
Tax.
• Form 944 for smallest employers (those whose annual
liability for social security, Medicare, and withheld federal
Reminders
income taxes is $1,000 or less) to file and pay these taxes only
Business meals expense. The temporary 100% deduction for once a year instead of every quarter.
food or beverages provided by a restaurant has expired. The • Form 1041 to report information for estates and trusts.
business meal deduction reverted back to the 50% allowable • Form 3520 to report certain transactions with foreign
deduction beginning January 1, 2023. See Line 6, later, for trusts and receipt of certain large gifts or bequests from certain
more information. foreign persons.
Form 7205, Energy Efficient Commercial Buildings Deduc- • Form 4562 to claim depreciation and amortization
tion. This form and its separate instructions are used to claim (including information on listed property) on assets placed in
the section 179D deduction for the cost of energy efficient service in 2024, to claim amortization that began in 2024, to
commercial building property and energy efficient building ret- make an election under section 179 to expense certain property,
rofit property placed in service during the tax year. or to report information on listed property.
Excess business loss limitation. If you report a loss on • Form 4684 to report a casualty or theft gain or loss
line 26, 32, 37, or 39 of your Schedule E (Form 1040), you involving property used in your trade or business or
may be subject to a business loss limitation. The disallowed income-producing property.
loss resulting from the limitation will not be reflected on • Form 4797 to report sales, exchanges, and involuntary
line 26, 32, 37, or 39 of your Schedule E. Instead, use Form conversions (not from a casualty or theft) of trade or business
461 to determine the amount of your excess business loss, property.
which will be included as income on Schedule 1 (Form 1040), • Form 6198 to apply a limitation to your loss from an
line 8p. Any disallowed loss resulting from this limitation will at-risk activity.
be treated as a net operating loss that must be carried forward • Form 7203 to figure potential limitations of your share of
and deducted in a subsequent year. the S corporation's deductions, credits, and other items that can
be deducted on your return.
See Form 461 and its instructions for details on the excess Form 7205 to claim the deduction for the cost of energy
business loss limitation. •
efficient commercial building property and energy efficient
Figuring a shareholder’s stock and debt basis. See Form building retrofit property placed in service during the tax year.
7203 and its separate instructions, which have been developed • Form 8082 to notify the IRS of any inconsistent tax
to replace the three-part Worksheet for Figuring a Sharehold- treatment for an item on your return.
er’s Stock and Debt Basis and its related instructions formerly
Instructions for Schedule E (Form 1040) (2024) Catalog Number 24332T
Nov 8, 2024 Department of the Treasury Internal Revenue Service www.irs.gov

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• Form 8582 to apply a limitation to your loss from passive though you and your spouse will not each file your own Sched-
activities. ule E as part of the QJV, each of you must report your interest
• Form 8824 to report like-kind exchanges. as separate properties on line 1 of Schedule E. On lines 3
• Form 8826 to claim a credit for expenditures to improve through 22 for each separate property interest, you must enter
access to your business for individuals with disabilities. your share of the applicable income, deduction, or loss.
• Form 8873 to figure your extraterritorial income If you have more than three rental real estate or royalty
exclusion. properties, complete and attach as many Schedules E as you
• Form 8960 to pay Net Investment Income Tax on certain need to list them. But fill in lines 23a through 26 on only one
income from your rental and other passive activities. Schedule E. The figures on lines 23a through 26 on that Sched-
• Form 8990 to determine whether your business interest ule E should be the combined totals for all properties reported
deduction is limited. on your Schedules E.
• Form 8995 or 8995-A to claim a deduction for qualified
Once made, the election can be revoked only with the per-
business income.
mission of the IRS. However, the election technically remains
Single-member limited liability company (LLC). In most in effect only for as long as the spouses filing as a QJV contin-
cases, a single-member domestic LLC is not treated as a sepa- ue to meet the requirements to be treated as a QJV. If the spou-
rate entity for federal income tax purposes. If you are the sole ses fail to meet the QJV requirements for a year, a new election
member of a domestic LLC, file Schedule E (or Schedule C or will be necessary for any future year in which the spouses meet
F, if applicable). However, you can elect to treat a domestic the requirements to be treated as a QJV.
LLC as a corporation. See Form 8832 for details on the elec-
Rental real estate income is generally not included in net
tion and the tax treatment of a foreign LLC.
earnings from self-employment subject to self-employment tax
Information returns. You may have to file information re- and is generally subject to passive loss limitation rules. Elect-
turns for wages paid to employees, certain payments of fees ing QJV status does not alter the application of the self-em-
and other nonemployee compensation, interest, rents, royalties, ployment tax or the passive loss limitation rules.
real estate transactions, annuities, and pensions. For details, see
For more information on QJVs, go to IRS.gov/QJV.
Line A, later, and the 2024 General Instructions for Certain In-
formation Returns. Reportable Transaction Disclosure
If you received cash of more than $10,000 in one or more Statement
related transactions in your trade or business, you may have to
Use Form 8886 to disclose information for each reportable
file Form 8300. For details, see Pub. 1544.
transaction in which you participated. Form 8886 must be filed
Qualified Joint Venture (QJV) for each tax year that your federal income tax liability is affec-
ted by your participation in the transaction. You may have to
If you and your spouse each materially participate (see Materi-
pay a penalty if you are required to file Form 8886 but do not
al participation in the Instructions for Schedule C) as the only
do so. You may also have to pay interest and penalties on any
members of a jointly owned and operated rental real estate
reportable transaction understatements. The following are re-
business and you file a joint return for the tax year, you can
portable transactions.
elect to be treated as a QJV instead of a partnership. This elec-
tion, in most cases, will not increase the total tax owed on the • Any listed transaction that is the same as or substantially
similar to tax avoidance transactions identified by the IRS.
joint return. By making the election, you will not be required to
file Form 1065 for any year the election is in effect and will in- • Any transaction offered to you or a related party under
conditions of confidentiality for which you paid an advisor a
stead report the income and deductions directly on your joint
fee of at least $50,000 for individuals or $250,000 for partner-
return. If you and your spouse filed Form 1065 for the year pri-
ships and trusts. See the Instructions for Form 8886.
or to the election, the partnership terminates at the end of the
tax year immediately preceding the year the election takes ef- • Certain transactions for which you or a related party have
contractual protection against disallowance of the tax benefits.
fect.
• Certain transactions resulting in a loss of at least $2 mil-
Note. Mere joint ownership of property that is not a trade or lion in any single tax year or $4 million in any combination of
business does not qualify for the election. tax years (at least $50,000 for a single tax year if the loss arose
from a foreign currency transaction defined in section 988(c)
Only businesses that are owned and operated by spou- (1), whether or not the loss flows through from an S corpora-
! ses as co-owners (and not in the name of a state law tion or partnership).
CAUTION entity) qualify for the election. Thus, a business owned
• Certain transactions of interest entered into that are the
and operated by spouses through an LLC does not qualify for same as or substantially similar to transactions that the IRS has
the election of a QJV. identified by notice, regulation, or other form of published
Making the election. To make this election for your rental re- guidance as transactions of interest.

al estate business, check the “QJV” box on line 2 for each See the Instructions for Form 8886 for more details.
property that is part of the QJV. You must divide all items of
income, gain, loss, deduction, and credit attributable to the Limitation on Losses
rental real estate business between you and your spouse in ac- If you report a loss from rental real estate or royalties in Part I,
cordance with your respective interests in the venture. Al- a loss from a partnership or S corporation in Part II, or a loss

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from an estate or trust in Part III, your loss may be reduced or Qualified nonrecourse financing. Qualified nonrecourse fi-
not allowed this year. You must apply the following rules to nancing is treated as an amount at risk if it is secured by real
your loss. property used in an activity of holding real property subject to
• Basis rules apply to losses from a partnership or S the at-risk rules. Qualified nonrecourse financing is financing
corporation. See Basis rules for partnerships and Basis rules for which no one is personally liable for repayment and is:
for S corporations, later, in Part II. Borrowed by you in connection with the activity of hold-
•
• At-risk rules apply to losses from rental real estate or ing real property (other than mineral property);
royalties. They also apply to losses from a partnership, S Not convertible from a debt obligation to an ownership
•
corporation, estate, or trust. See At-Risk Rules, later, in the interest; and
General Instructions. If the loss is from a partnership or S Loaned or guaranteed by any federal, state, or local gov-
•
corporation, also see At-risk rules, later, in Part II. ernment, or borrowed by you from a qualified person.
• Passive activity loss rules apply to losses from rental real
estate. They also apply to losses from a partnership, S Qualified person. A qualified person is a person who ac-
corporation, estate, or trust. See Passive Activity Loss Rules, tively and regularly engages in the business of lending money,
later, in the General Instructions. If the loss is from a such as a bank or savings and loan association. A qualified per-
partnership or S corporation, also see Passive activity loss son cannot be:
rules, later, in Part II. • Related to you (unless the nonrecourse financing obtained
• Excess business loss rules apply to losses from all is commercially reasonable and on substantially the same terms
noncorporate trades or businesses. This loss limitation is as loans involving unrelated persons),
figured using Form 461 after you complete your Schedule E. • The seller of the property (or a person related to the sell-
Any limitation to your loss resulting from these rules will not er), or
be reflected on your Schedule E. Instead, it will be included as • A person who receives a fee due to your investment in re-
income on Schedule 1 (Form 1040), line 8p, and treated as a al property (or a person related to that person).
net operating loss that must be carried forward and deducted in More information. For more details about the at-risk rules,
a subsequent year. These rules also apply to losses from a see the Instructions for Form 6198 and Pub. 925.
partnership or S corporation.
Passive Activity Loss Rules
At-Risk Rules The passive activity loss rules may limit the amount of losses
In most cases, you must complete Form 6198 to figure your you can deduct. These rules apply to losses in Parts I, II, and
loss if you have: III, and line 40 of Schedule E.
• A loss from an activity carried on as a trade or business
Losses from passive activities may be subject first to the
or for the production of income, and
at-risk rules. Losses deductible under the at-risk rules are then
• Amounts in the activity for which you are not at risk.
subject to the passive activity loss rules.
The at-risk rules in most cases limit the amount of loss (in- You can deduct losses from passive activities in most cases
cluding loss on the disposition of assets) you can claim to the only to the extent of income from passive activities. An excep-
amount you could actually lose in the activity. However, the tion for certain rental real estate activities (explained later)
at-risk rules do not apply to losses from an activity of holding may apply.
real property placed in service before 1987. They also do not
apply to losses from your interest acquired before 1987 in a
Passive Activity
pass-through entity engaged in such activity. The activity of
holding mineral property does not qualify for this exception. A passive activity is any business activity in which you did not
materially participate and any rental activity, except as ex-
In most cases, you are not at risk for amounts such as the plained later. If you are a limited partner, in most cases, you are
following. not treated as having materially participated in the partnership's
• Nonrecourse loans used to finance the activity, to acquire activities for the year.
property used in the activity, or to acquire your interest in the
The rental of real or personal property is a rental activity un-
activity that are not secured by your own property (other than
der the passive activity loss rules in most cases, but exceptions
property used in the activity). However, there is an exception
apply. If your rental of property is not treated as a rental activi-
for certain nonrecourse financing borrowed by you in connec-
ty, you must determine whether it is a trade or business activity
tion with the activity of holding real property (other than min-
and, if so, whether you materially participated in the activity
eral property). See Qualified nonrecourse financing, later.
for the tax year.
• Cash, property, or borrowed amounts used in the activity
(or contributed to the activity, or used to acquire your interest See the Instructions for Form 8582 to determine whether
in the activity) that are protected against loss by a guarantee, you materially participated in the activity and for the definition
stop-loss agreement, or other similar arrangement (excluding of “rental activity.”
casualty insurance and insurance against tort liability). See Pub. 925 for special rules that apply to rentals of:
• Amounts borrowed for use in the activity from a person • Substantially nondepreciable property,
who has an interest in the activity (other than as a creditor) or • Property incidental to development activities, and
who is related under section 465(b)(3)(C) to a person (other • Property related to activities in which you materially par-
than you) having such an interest. ticipate.

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Activities That Are Not Passive Activities Exception for Certain Rental Real Estate Activities
Activities of real estate professionals. If you were a real es- If you meet all of the following conditions, your rental real es-
tate professional for 2024, any rental real estate activity in tate losses are not limited by the passive activity loss rules, and
which you materially participated is not a passive activity. You you do not need to complete Form 8582. If you do not meet all
were a real estate professional for the year only if you met both of these conditions, see the Instructions for Form 8582 to find
of the following conditions. out if you must complete and attach Form 8582 to figure any
• More than half of the personal services you performed in losses allowed.
trades or businesses during the year were performed in real 1. Rental real estate activities are your only passive activi-
property trades or businesses in which you materially participa- ties.
ted. 2. You do not have any prior year unallowed losses from
• You performed more than 750 hours of services during any passive activities.
the year in real property trades or businesses in which you ma-
3. All of the following apply if you have an overall net loss
terially participated.
from these activities.
If you are married filing jointly, either you or your spouse
a. You actively participated (defined later) in all of the
must meet both of the above conditions without taking into ac-
rental real estate activities.
count services performed by the other spouse.
b. If married filing separately, you lived apart from your
A real property trade or business is any real property devel-
spouse all year.
opment, redevelopment, construction, reconstruction, acquisi-
tion, conversion, rental, operation, management, leasing, or c. Your overall net loss from these activities is $25,000 or
brokerage trade or business. Services you performed as an em- less ($12,500 or less if married filing separately).
ployee are not treated as performed in a real property trade or d. You have no current or prior year unallowed credits
business unless you owned more than 5% of the stock (or more from passive activities.
than 5% of the capital or profits interest) in the employer. e. Your modified adjusted gross income (MAGI) is
If you qualify as a real estate professional, rental real estate $100,000 or less ($50,000 or less if married filing separately).
activities in which you materially participated are not passive For a definition of MAGI, see Special $25,000 allowance in
activities. For purposes of determining whether you materially Pub. 925. Also see Line 6 in the Instructions for Form 8582.
participated in your rental real estate activities, each interest in f. You do not hold any interest in a rental real estate activi-
rental real estate is a separate activity unless you elect to treat ty as a limited partner or as a beneficiary of an estate or a trust.
all your interests in rental real estate as one activity. To make
this election, attach a statement to your original tax return that Active participation. You can meet the active participation
declares you are a qualifying taxpayer for the year and you are requirement without regular, continuous, and substantial in-
making the election under section 469(c)(7)(A). The election volvement in real estate activities. But you must have participa-
applies for the year made and all later years in which you are a ted in making management decisions or arranging for others to
real estate professional. You can revoke the election only if provide services (such as repairs) in a significant and bona fide
your facts and circumstances materially change. sense. Such management decisions include:
If you did not make this election on your timely filed • Approving new tenants,
TIP return, you may be eligible to make a late election to • Deciding on rental terms,
treat all your interest in rental real estate as one activ- • Approving capital or repair expenditures, and
ity. See Rev. Proc. 2011-34, 2011-24 I.R.B. 875, available at • Other similar decisions.
IRS.gov/irb/2011-24_IRB#RP-2011-34. You are not considered to actively participate if, at any time
during the tax year, your interest (including your spouse's inter-
If you were a real estate professional for 2024, complete est) in the activity was less than 10% by value of all interests in
Schedule E, line 43. the activity. Except as provided in regulations, limited partners
Other activities. The rental of a dwelling unit that you used as aren't treated as actively participating in a partnership's rental
a home is not subject to the passive loss limitation rules. See real estate activities.
Line 2, later, to see if you used the dwelling unit as a home.
Recordkeeping
A working interest in an oil or gas well you held directly or
through an entity that did not limit your liability is not a pas- You must keep records to support items reported on Schedule E
sive activity even if you did not materially participate. in case the IRS has questions about them. If the IRS examines
your tax return, you may be asked to explain the items repor-
Royalty income not derived in the ordinary course of a trade ted. Good records will help you explain any item and arrive at
or business reported on Schedule E in most cases is not consid- the correct tax with a minimum of effort. If you do not have re-
ered income from a passive activity. cords, you may have to spend time getting statements and re-
For more details on passive activities, see the Instructions ceipts from various sources. If you cannot produce the correct
for Form 8582 and Pub. 925. documents, you may have to pay additional tax and be subject
to penalties.

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business of renting personal property. You are in the business
of renting personal property if the primary purpose for renting
Specific Instructions the property is income or profit and you are involved in the
Filers of Form 1041. If you are a fiduciary filing Schedule E rental activity with continuity and regularity.
with Form 1041, enter the estate's or trust's employer identifi- If your rental of personal property is not a business, see the
cation number (EIN) in the space for “Your social security instructions for Schedule 1 (Form 1040), lines 8l and 24b, to
number.” find out how to report the income and expenses.
Extraterritorial income exclusion. Except as otherwise pro-
vided in the Internal Revenue Code, gross income includes all
income from whatever source derived. Gross income, however,
Part I
does not include extraterritorial income that is qualifying for-
Before you begin, see Line 3 and Line 4, later, to de- eign trade income under certain circumstances. Use Form 8873
! termine if you should report your rental real estate to figure the extraterritorial income exclusion. Report it on
CAUTION and royalty income on Schedule C or Form 4835, in- Schedule E as explained in the Instructions for Form 8873.
stead of Schedule E. Chapter 11 bankruptcy cases. If you were a debtor in a chap-
ter 11 bankruptcy case, see Chapter 11 Bankruptcy Cases under
Income in the Instructions for Form 1040.
Line A
If you made any payments in 2024 that would require you to Income you report on Schedule E may be qualified
file any Forms 1099, check the “Yes” box. Otherwise, check TIP business income and entitle you to a deduction on
the “No” box. In general, if you paid at least $600 for services Form 1040, 1040-SR, or 1040-NR. See the Instruc-
performed by someone who is not your employee (nonemploy- tions for Form 8995-A for more information about this deduc-
ee compensation), you must file Form 1099-NEC; and, you tion.
generally must file Form 1099-MISC if you paid at least $600
in rents, prizes, medical and health care payments, or other Line 1a
miscellaneous amounts that would be income to the person re-
For rental real estate property only, show the street address,
ceiving them. See the 2024 General Instructions for Certain In-
city or town, state, and ZIP code. If the property is located in a
formation Returns if you are unsure whether you were required
foreign country, enter the city, province or state, country, and
to file any Forms 1099. Also, see the separate instructions for
postal code.
each Form 1099.
Line 1b
Income or Loss From Rental Real
Enter one of the codes listed under “Type of Property” in Part I
Estate and Royalties of the form.
Use Part I to report the following. Land rental. Enter code “5” for rental of land. For details
• Income and expenses from rental real estate (including about the tax treatment of income from this type of rental prop-
personal property leased with real estate). erty, see Rental of Nondepreciable Property in Pub. 925.
• Royalty income and expenses.
Self-rental. Enter code “7” for self-rental if you rent property
• For an estate or trust only, farm rental income and expen-
to a trade or business in which you materially participated. See
ses based on crops or livestock produced by the tenant. Estates
Rental of Property to a Nonpassive Activity in Pub. 925 for de-
and trusts do not use Form 4835 or Schedule F (Form 1040)
tails about the tax treatment of income from this type of rental
for this purpose.
property.
If you own a part interest in a rental real estate property, re- Other. Enter code “8” if the property is not one of the other
port only your part of the income and expenses on Schedule E. types listed on the form. Attach a statement to your return de-
scribing the property.
Complete lines 1a, 1b, and 2 for each rental real estate prop-
erty. For royalty property, enter code “6” on line 1b and leave
lines 1a and 2 blank for that property. Line 2
If you rented out a dwelling unit that you also used for personal
If you have more than three rental real estate or royalty purposes during the year, you may not be able to deduct all the
properties, complete and attach as many Schedules E as you expenses for the rental part. “Dwelling unit” (unit) means a
need to list them. But answer lines A and B and fill in lines 23a house, apartment, condominium, mobile home, boat, or similar
through 26 on only one Schedule E. The figures on lines 23a property.
through 26 on that Schedule E should be the combined totals
for all properties reported on your Schedules E. If you are also For each property listed on line 1a, report the number of
using page 2 of Schedule E, use the same Schedule E on which days in the year each property was rented at fair rental value
you entered the combined totals for Part I. and the number of days of personal use.
Personal property. Do not use Schedule E to report income A day of personal use is any day, or part of a day, that the
and expenses from the rental of personal property, such as unit was used by:
equipment or vehicles. Instead, use Schedule C if you are in the • You for personal purposes;

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• Any other person for personal purposes, if that person If you received services or property instead of money as
owns part of the unit (unless rented to that person under a rent, report the fair market value of the services or property as
“shared equity” financing agreement); rental income on line 3.
• Anyone in your family (or in the family of someone else
Generally, rental real estate activity is reported on Sched-
who owns part of the unit), unless the unit is rented at a fair
ule E even if it is also a trade or business activity; however, if
rental price to that person as his or her main home;
you provided significant services to the renter, such as maid
• Anyone who pays less than a fair rental price for the unit;
service, report the rental activity on Schedule C, not on Sched-
or
ule E. Significant services do not include the furnishing of heat
• Anyone under an agreement that lets you use some other
and light, cleaning of public areas, trash collection, or similar
unit.
services.
Do not count as personal use:
• Any day you spent working substantially full time repair- If you were a real estate dealer, include only the rent re-
ing and maintaining the unit, even if family members used it ceived from real estate (including personal property leased with
for recreational purposes on that day; or this real estate) you held for the primary purpose of renting to
• Any days you used the unit as your main home before or produce income. Do not use Schedule E to report income and
after renting it or offering it for rent, if you rented or tried to expenses from rentals of real estate you held for sale to cus-
rent it for at least 12 consecutive months (or for a period of less tomers in the ordinary course of your business as a real estate
than 12 consecutive months at the end of which you sold or ex- dealer. Instead, use Schedule C for those rentals.
changed it). For more details on rental income, see Pub. 527.
Whether or not you can deduct expenses for the unit de- Rental income from farm production or crop shares. Re-
pends on whether or not you used the unit as a home in 2024. port farm rental income and expenses on Form 4835 if:
You used the unit as a home if your personal use of the unit • You are an individual,
was more than the greater of: • You received rental income based on crops or livestock
• 14 days, or produced by the tenant, and
• 10% of the total days it was rented to others at a fair rent- • You did not materially participate in the management or
al price. operation of the farm.
If you did not use the unit as a home, you can deduct all
your expenses for the rental part, subject to the at-risk rules Line 4
and the passive activity loss rules explained earlier. Report on line 4 royalties from oil, gas, or mineral properties
If you did use the unit as a home and rented the unit out for (not including operating interests); copyrights; name, image,
fewer than 15 days in 2024, do not report the rental income and and likeness (NIL) rights (such as licensing and merchandising
do not deduct any rental expenses. If you itemize deductions on agreements); and patents. Use a separate column (A, B, or C)
Schedule A, you can deduct allowable interest, taxes, and casu- for each royalty property.
alty losses. If you received $10 or more in royalties during 2024, the
If you did use the unit as a home and rented the unit out for payer should send you a Form 1099-MISC or similar statement
15 or more days in 2024, you may not be able to deduct all by January 31, 2025, showing the amount you received. Report
your rental expenses. See Pub. 527 for more information. this amount on line 4.
Regardless of whether you used the unit as a home, If you are in business as a self-employed writer, inventor, ar-
tist, etc., report your royalty income and expenses on Sched-
CAUTION as rental expenses. You must allocate your expenses
! expenses related to days of personal use do not qualify ule C, not on Schedule E.
based on the number of days of personal use to total use of the If you are a student-athlete, any monetary or financial gain,
property. For example, you used your property for personal use including non-cash compensation like merchandise or gift
for 7 days and rented it for 63 days. In most cases, 10% (7 ÷ cards, you received from a transaction in which you benefit
70) of your expenses are not rental expenses and cannot be de- from the use of your name, image, or likeness is NIL income.
ducted on Schedule E. If your NIL income is derived from business activities such as
QJV. Check the box for “QJV” if you owned the property as a sponsorship deals or service income, report your income and
member of a QJV reporting income not subject to self-employ- expenses on Schedule C, not Schedule E. However, if your NIL
ment tax. See Qualified Joint Venture (QJV), earlier. income is royalty income that is not self-employment income,
report the NIL royalty income and expenses on Schedule E.
Line 3 You may be able to treat amounts received as “royalties” for
If you received rental income from real estate (including per- the transfer of a patent or amounts received on the disposal of
sonal property leased with real estate), report the income on coal and iron ore as the sale of a capital asset. For details, see
line 3. Use a separate column (A, B, or C) for each rental prop- Pub. 544.
erty. Include income received for renting a room or other space.
Enter on line 4 the gross amount of royalty income, even if
Any other income should be included and reported on line 3, state or local taxes were withheld from oil or gas payments you
with a statement attached to your return. received. Include taxes withheld by the producer on line 16.

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See Pub. 527 and Pub. 463 for details.
General Instructions for Lines 5 Through 21
Enter your rental and royalty expenses for each property in the Line 10
appropriate column. You can deduct all ordinary and necessary
Include on line 10 fees for tax advice and the preparation of tax
expenses, such as taxes, interest, repairs, insurance, manage-
forms related to your rental real estate or royalty properties.
ment fees, agents' commissions, and depreciation.
Do not deduct the value of your own labor or amounts paid Do not deduct legal fees paid or incurred to defend or pro-
for capital investments or capital improvements. tect title to property, to recover property, or to develop or im-
prove property. Instead, you must capitalize these fees and add
Enter your total expenses for mortgage interest (line 12), de- them to the property's basis.
preciation expenses and depletion (line 18), and total expenses
(line 20) on lines 23c through 23e, respectively, even if you
Lines 12 and 13
have only one property.
In most cases, to determine the interest expense allocable to
Renting out part of your home. If you rent out only part of
your rental activities, you must have records to show how the
your home or other property, deduct the part of your expenses
proceeds of each debt were used. Specific tracing rules apply
that applies to the rented part.
for allocating debt proceeds and repayment. In general, you al-
Credit or deduction for access expenditures. You may be locate interest on a loan the same way you allocate the loan
able to claim a tax credit for eligible expenditures paid or in- proceeds. You allocate loan proceeds by tracing disbursements
curred in 2024 to provide access to your business for individu- to specific uses.
als with disabilities. See Form 8826 for details.
The easiest way to trace disbursements to specific
You can also elect to deduct up to $15,000 of qualified costs
TIP uses is to keep the proceeds of a particular loan sepa-
paid or incurred in 2024 to remove architectural or transporta-
rate from any other funds.
tion barriers to individuals with disabilities and the elderly.
You cannot take both the credit and the deduction for the Limitation on business interest. Interest you paid as part of
same expenditures. your rental real estate activity is not subject to the limitation on
business interest unless your rental real estate activity is a trade
Line 6 or business. If your rental real estate activity is a trade or busi-
ness, you must file Form 8990 to deduct any interest expenses
You can deduct ordinary and necessary auto and travel expen-
of that rental real estate activity unless you meet one of the fil-
ses related to your rental activities, including 50% of meal ex-
ing exceptions in the Instructions for Form 8990 .
penses incurred while traveling away from home.
If the interest you paid in your rental real estate trade or
In most cases, you can either deduct your actual expenses or
business is limited, figure the limit on your business interest
take the standard mileage rate. You must use actual expenses if
expenses on Form 8990 before completing lines 12 and 13.
you used more than four vehicles simultaneously in your rental
Follow the instructions under How to report, later, but report
activities (as in fleet operations). You cannot use actual expen-
the reduced interest on lines 12 and 13. The interest you can't
ses for a leased vehicle if you previously used the standard
deduct this year will carry forward to next year on Form 8990 .
mileage rate for that vehicle.
If your real estate activity is not a trade or business or you
You can use the standard mileage rate for 2024 only if you:
meet one of the filing exceptions for Form 8990, follow the in-
• Owned the vehicle and used the standard mileage rate for
structions under How to report, later, and report all of your de-
the first year you placed the vehicle in service; or
ductible interest on lines 12 and 13.
• Leased the vehicle and are using the standard mileage
rate for the entire lease period (except the period, if any, before How to report. If you have a mortgage on your rental proper-
1998). ty, enter on line 12 the amount of interest you paid for 2024 to
banks or other financial institutions.
If you take the standard mileage rate, multiply the number
of miles driven in connection with your rental activities by 67 Do not deduct prepaid interest when you paid it. You can
cents a mile. Include this amount and your parking fees and deduct it only in the year to which it is properly allocable.
tolls on line 6. Points, including loan origination fees, charged only for the use
of money must be deducted over the life of the loan.
You cannot deduct rental or lease payments, deprecia-
If you paid $600 or more in interest on a mortgage during
! tion, or your actual auto expenses if you use the 2024, the recipient should send you a Form 1098 or similar
CAUTION standard mileage rate.
statement by January 31, 2025, showing the total interest re-
If you deduct actual auto expenses: ceived from you.
• Include on line 6 the rental activity portion of the cost of If you paid more mortgage interest than is shown on your
gasoline, oil, repairs, insurance, tires, license plates, etc.; and Form 1098 or similar statement, see Pub. 334 regarding deduc-
• Show auto rental or lease payments on line 19 and depre- tion limits to find out if you can deduct part or all of the addi-
ciation on line 18. tional interest. If you can, enter the entire deductible amount on
If you claim any auto expenses (actual or the standard mile- line 12. Attach a statement to your return explaining the differ-
age rate), you must complete Part V of Form 4562 and attach ence. In the space to the left of line 12, enter “See attached.”
Form 4562 to your tax return.

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Note. If the recipient was not a financial institution or you did If you have an economic interest in mineral property, you
not receive a Form 1098 from the recipient, report your deduc- may be able to take a deduction for depletion. Mineral property
tible mortgage interest on line 13. includes oil and gas wells, mines, and other natural deposits
(including geothermal deposits). See section 614 and the rela-
If you and at least one other person (other than your spouse ted regulations for rules on how to treat separate mineral inter-
if you file a joint return) were liable for and paid interest on the ests.
mortgage, and the other person received Form 1098, report
your share of the deductible interest on line 13. Attach a state- Separating cost of land and buildings. If you buy buildings
ment to your return showing the name and address of the per- and your cost includes the cost of the land on which they stand,
son who received Form 1098. On the dotted line next to you must divide the cost between the land and the buildings to
line 13, enter “See attached.” figure the basis for depreciation of the buildings. The part of
the cost that you allocate to each asset is the ratio of the fair
market value of that asset to the fair market value of the whole
Line 14
property at the time you buy it.
You can deduct the amounts paid for repairs and maintenance.
If you are not certain of the fair market values of the land
However, you cannot deduct the cost of improvements. Repairs
and the buildings, you can divide the cost between them based
and maintenance costs are those costs that keep the property in
on their assessed values for real estate tax purposes.
an ordinarily efficient operating condition. Examples are fixing
a broken lock or painting a room.
Line 19
In contrast, improvements are amounts paid to better or re-
store your property or adapt it to a new or different use. Exam- Enter on line 19 any ordinary and necessary expenses not listed
ples of improvements are adding substantial insulation or re- on lines 5 through 18.
placing an entire HVAC system. Amounts paid to improve your You may be able to deduct, on line 19, part or all of the cost
property must generally be capitalized and depreciated (that is, of energy efficient commercial building property and energy
they cannot be deducted in full in the year they are paid or in- efficient building retrofit property placed in service during the
curred). See Line 18, later. tax year. For details, see section 179D, Form 7205 and its sepa-
rate instructions, and Rev. Proc. 2022-14, 2022-7 I.R.B. 580,
Line 17 available at Rev. Proc. 2022-14.
You can deduct the cost of ordinary and necessary telephone
calls related to your rental activities or royalty income (for ex- Line 21
ample, calls to the renter). However, the base rate (including If you have amounts for which you are not at risk, use Form
taxes and other charges) for local telephone service for the first 6198 to determine the amount of your deductible loss. Enter
telephone line into your residence is a personal expense and is that amount in the appropriate column of Schedule E, line 21.
not deductible. In the space to the left of line 21, enter “Form 6198.” Attach
Form 6198 to your return. For details on the at-risk rules, see
Line 18 At-Risk Rules, earlier.
Depreciation is the annual deduction you must take to recover
the cost or other basis of business or investment property hav- Line 22
ing a useful life substantially beyond the tax year. Land is not Do not complete line 22 if the amount on line 21 is from royal-
depreciable. ty properties.
Depreciation starts when the property is available and ready If you have a rental real estate loss from a passive activi-
for use in your business or for the production of income. It ty(defined earlier), the amount of loss you can deduct may be
ends when you deduct all your depreciable cost or other basis limited by the passive activity loss rules. You may need to
or no longer use the property in your business or for the pro- complete Form 8582 to figure the amount of loss, if any, to en-
duction of income. ter on line 22. See the Instructions for Form 8582 to determine
See the Instructions for Form 4562 to figure the amount of if your loss is limited.
depreciation to enter on line 18. If your rental real estate loss is not from a passive activity or
You must complete and attach Form 4562 only if you are you meet the exception for certain rental real estate activities
claiming: (explained earlier), you do not have to complete Form 8582.
• Depreciation on property first placed in service during Enter the (loss) from line 21 on line 22.
2024; If you have an unallowed rental real estate loss from a prior
• Depreciation on listed property (defined in the Instruc- year that after completing Form 8582 you can include this year,
tions for Form 4562), including a vehicle, regardless of the date include that loss on line 22.
it was placed in service; or
• A section 179 expense deduction or amortization of costs
that began in 2024.
See Pub. 527 for more information on depreciation of resi- Parts II and III
dential rental property. See Pub. 946 for a more comprehensive If you need more space in Part II or III to list your income or
guide to depreciation. losses, attach a continuation sheet using the same format as

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shown in Part II or III. However, be sure to complete the “To- If you had a loss from a partnership that was not allowed
tals” columns for lines 29a and 29b, or lines 34a and 34b, as last year because of the basis rules, but all or part is allowed
appropriate. If you also completed Part I on more than one this year, see Line 27, later, for how to report it.
Schedule E, use the same Schedule E on which you entered the After applying the basis rules, the loss you report on Sched-
combined totals in Part I. ule E may be further reduced by the at-risk rules and passive
Tax preference items. If you are a partner, a shareholder in an activity loss rules.
S corporation, or a beneficiary of an estate or trust, you must Basis rules for S corporations. Generally, the deduction for
take into account your share of preferences and adjustments your share of aggregate losses and deductions reported on
from these entities for the alternative minimum tax on Form Schedule K-1 (Form 1120-S) is limited to the basis of your
6251 or Schedule I (Form 1041). stock (determined with regard to distributions received during
the tax year) and loans from you to the corporation. The basis
of your stock is generally figured at the end of the corporation's
Part II tax year. Any losses and deductions not allowed this year be-
cause of the basis limit can be carried forward indefinitely and
Income or Loss From Partnerships and S deducted in a later year subject to the basis limit for that year.
Corporations To figure your aggregated stock basis, you can generally use
Form 7203. For more details on the basis rules for S corpora-
If you are a member of a partnership or joint venture or a tions, see the Instructions for Form 7203.
shareholder in an S corporation, use Part II to report your share
of the partnership or S corporation income (even if not re- If you are claiming a deduction for your share of an aggre-
ceived) or loss. gate loss (or you receive a distribution, dispose of stock, or re-
ceive a loan repayment from an S corporation), check the box
If you elected to be taxed as a QJV instead of a part- on the appropriate line in Part III, column (e), and attach Form
! nership, follow the reporting rules under QJV, earlier. 7203 to your return.
CAUTION
If you had a loss from an S corporation that was not allowed
You should receive a Schedule K-1 from the partnership or last year because of the basis rules, but all or part is allowed
S corporation. You should also receive a copy of the Partner's this year, see Line 27, later, for how to report it.
or Shareholder's Instructions for Schedule K-1. Your copy of After applying the basis rules, the loss you report on Sched-
Schedule K-1 and its instructions will tell you where on your ule E may be further reduced by the at-risk rules and passive
return to report your share of the items. If you did not receive activity loss rules.
these instructions with your Schedule K-1, see your tax return
instructions for how to get tax forms, instructions, and publica- At-risk rules. If you have (a) a loss or other deduction from
tions. Do not attach Schedules K-1 to your return. Keep them any activity carried on as a trade or business or for the produc-
for your records. tion of income by the partnership or S corporation, and (b)
amounts in the activity for which you are not at risk, your loss
If you are treating items on your tax return differently from may be limited. For more information, see At-Risk Rules, earli-
the way the partnership or S corporation reported them on its er.
return, you may have to file Form 8082.
If you are subject to the at-risk rules for any activity, check
the box on the appropriate line in Part II, column (f), of Sched-
Special Rules That Limit Losses
ule E, and use Form 6198 to figure the amount of any deducti-
If you report a loss from a partnership or S corporation, your ble loss. If the activity is nonpassive, enter any deductible loss
loss may be reduced or not allowed this year. Apply the basis from Form 6198 on the appropriate line in Part II, column (i),
rules, at-risk rules, and passive activity loss rules to your loss of Schedule E.
on Schedule E.
If you had a loss from the partnership or S corporation that
If your loss is also subject to the excess business loss rules, was not allowed last year because of the at-risk rules, but all or
you figure that limitation separately on Form 461. Any reduc- part is allowed this year, see Line 27, later, for how to report it.
tion to your loss due to the excess business loss rules will not
After applying the at-risk rules, the loss you report on
be reflected on your Schedule E. See the Instructions for Form
Schedule E may be further reduced by the passive activity loss
461 for more information.
rules.
Basis rules for partnerships. Generally, you may not claim
Passive activity loss rules. For more information about pas-
your share of a partnership loss (including a capital loss) to the
sive activity losses, see Passive Activity Loss Rules, earlier.
extent that it is greater than the adjusted basis of your partner-
ship interest at the end of the partnership's tax year. Any losses If you have a passive activity loss, in most cases you need to
and deductions not allowed this year because of the basis limit complete Form 8582 to figure the amount of the loss to enter in
can be carried forward indefinitely and deducted in a later year Part II, column (g), for that activity. But if you are a general
subject to the basis limit for that year. To figure the basis of partner or an S corporation shareholder reporting your share of
your interest in a partnership, you can use the Worksheet for a partnership or an S corporation loss from a rental real estate
Adjusting the Basis of a Partner's Interest in the Partnership in activity and you meet all of the conditions listed earlier under
the Partner's Instructions for Schedule K-1 (Form 1065). For Exception for Certain Rental Real Estate Activities, you do not
more details on the basis rules for partnerships, see Pub. 541.

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have to complete Form 8582. Instead, enter your (loss) in Part report only the income shown on Schedule K-1 in accordance
II, column (g). with its instructions.
If you have passive activity income, complete Part II, col- If you are not a U.S. person, you may have received Forms
umn (h), for that activity. If you have nonpassive income or 1042-S reporting your share of certain partnership income, be-
losses, complete Part II, columns (i) through (k), as appropri- cause payors of income to the foreign partnership in most cases
ate. are required to allocate and report payments of that income di-
If you had a loss from the partnership or S corporation that rectly to each of the partners of the foreign partnership. If you
was not allowed last year because of the passive activity loss received both Schedule K-1 and Form 1042-S for the same
rules, but all or part is allowed this year, see Line 27, later, for type and source of partnership income, report the income on
how to report it. your return as follows.
Excess business loss rules. If you report a loss on Schedule E • For all income effectively connected with the conduct of
a trade or business in the United States, report only the income
from a partnership or S corporation engaged in a trade or busi-
shown on Schedule K-1 in accordance with its instructions.
ness, use Form 461 to figure your excess business loss. Your
excess business loss will not be reflected on your Schedule E; • For all income not effectively connected with the conduct
of a trade or business in the United States, report on Sched-
instead, it will be added to your income on Form 1040 and car-
ule NEC (Form 1040-NR) only the income shown on Form
ried forward to a subsequent year as a net operating loss. For
1042-S (if you are required to file Form 1040-NR).
more information, see the Instructions for Form 461.
Requirement to file Form 8865. If you are a U.S. person, you
Domestic Partnerships may have to file Form 8865 if any of the following applies.
1. You controlled a foreign partnership (that is, you owned
See the Schedule K-1 instructions before entering on your re-
more than a 50% direct or indirect interest in the partnership).
turn other partnership items from a passive activity or income
or loss from any publicly traded partnership. 2. You owned at least a 10% direct or indirect interest in a
foreign partnership while U.S. persons controlled that partner-
You can deduct unreimbursed ordinary and necessary ex-
ship.
penses you paid on behalf of the partnership if you were re-
quired to pay these expenses under the partnership agreement. 3. You had an acquisition, disposition, or change in propor-
See Line 27, later, for how to report these expenses. tional interest of a foreign partnership that:
If you used loan proceeds to buy an interest in, or make a a. Increased your direct interest to at least 10% or reduced
contribution to the capital of, a partnership (debt-financed ac- your direct interest of at least 10% to less than 10%, or
quisition), report your share of deductible partnership interest b. Changed your direct interest by at least a 10% interest.
expense on either Schedule A or Schedule E, depending on the 4. You contributed property to a foreign partnership in ex-
type of asset (or expenditure if the allocation is based on the change for a partnership interest if:
tracing of loan proceeds) to which the interest expense is allo-
cated. See Line 28, later, for more information about reporting a. Immediately after the contribution, you owned, directly
these interest expenses. or indirectly, at least a 10% interest in the partnership; or
If you claimed a credit for federal tax on gasoline or other b. The value of the property you contributed, when added
fuels on your 2023 Form 1040, 1040-SR, or 1040-NR based on to the value of any other property you or any related person
information received from the partnership, enter as income in contributed to the partnership during the 12-month period end-
column (h) or column (k), whichever applies, the amount of the ing on the date of transfer, exceeds $100,000.
credit claimed for 2023. Also, you may have to file Form 8865 if you contributed
Part or all of your share of partnership income or loss from property with built-in gain to a foreign partnership (or certain
the operation of the business may be considered net earnings domestic partnerships) or to report certain dispositions by a
from self-employment that must be reported on Schedule SE. foreign partnership of property you previously contributed to
Enter the amount from Schedule K-1 (Form 1065), box 14, that partnership if you were a partner at the time of the disposi-
code A, on Schedule SE after you reduce this amount by any tion.
allowable expenses attributable to that income. For more details, including penalties for failing to file Form
8865, see Form 8865 and its separate instructions.
Foreign Partnerships
Follow the instructions below in addition to the instructions S Corporations
earlier under Domestic Partnerships. Distributions of prior year accumulated earnings and profits of
If you are a U.S. person, you may have received Forms S corporations are dividends and are reported on Form 1040 or
1099-B, 1099-DIV, and 1099-INT reporting your share of cer- 1040-SR, line 3b.
tain partnership income, because payors of income to the for- If you used loan proceeds to buy an interest in, or make a
eign partnership in most cases are required to allocate and re- contribution to the capital of, an S corporation (debt-financed
port payments of that income directly to each of the partners of acquisition), report your share of deductible S corporation in-
the foreign partnership. If you received both Schedule K-1 and terest expense on either Schedule A or Schedule E, depending
Form 1099 for the same type and source of partnership income, on the type of asset (or expenditure if the allocation is based on
the tracing of loan proceeds) to which the interest expense is

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allocated. See Line 28, later, for more information about report- ship or S corporation. Report each related item required to be
ing these interest expenses. reported on Schedule E (including items of income or loss sta-
Your share of the net income of an S corporation is not sub- ted separately on Schedule K-1) in the applicable column of a
ject to self-employment tax. separate line following the line on which you reported the cur-
rent year ordinary income or loss. Also, enter a description of
Line 27 the related item (for example, depletion) in column (a) of the
same line.
If you answered “Yes” on line 27, follow the instructions be-
low. If you do not follow these instructions, the IRS may send If you are required to file Form 8582, see the Instructions
you a notice of additional tax due because the amounts reported for Form 8582 before completing Schedule E.
by the partnership or S corporation on Schedule K-1 do not Debt-financed acquisition. A debt-financed acquisition is the
match the amounts you reported on your tax return. use of loan proceeds to buy an interest in, or to make a contri-
bution to the capital of, a partnership or S corporation. You
Losses Not Allowed in Prior Years Due to the Basis must allocate the loan proceeds and the related interest expense
or At-Risk Rules among all the assets of the entity. You can use any reasonable
method.
• Enter your total prior year unallowed losses that are now
deductible on a separate line in column (i) of line 28. Do not For interest allocated to trade or business assets (or expendi-
combine these losses with, or net them against, any current tures), report the interest on a separate line of your Schedule E,
year amounts from the partnership or S corporation. Part II. Enter "business interest" and the name of the partner-
• Enter “PYA” in column (a) of the same line. ship or S corporation in column (a) and the amount in column
(i).
Prior Year Unallowed Losses From a Passive Activity For interest allocated to passive activity use, enter the inter-
Not Reported on Form 8582 est on Form 8582 as a deduction from the passive activity of
the partnership or S corporation. Show any deductible amount
• Enter on a separate line in column (g) of line 28 your to-
on a separate line on your Schedule E, Part II. Enter "passive
tal prior year unallowed losses not reported on Form 8582.
interest" and the name of the entity in column (a) and the
Such losses include prior year unallowed losses now deductible
amount in column (g).
because you did not have an overall loss from all passive activ-
ities or you disposed of your entire interest in a passive activity For interest allocated to investment use, enter the interest on
in a fully taxable transaction. Do not combine these losses Form 4952. Carry any deductible amount allocated to royalties
with, or net them against, any current year amounts from the to a separate line of your Schedule E, Part II. Enter "investment
partnership or S corporation. interest" and the name of the entity in column (a) and the
• Enter “PYA” in column (a) of the same line. amount in column (i). Carry the balance of the deductible
amount to Schedule A, line 9.
Unreimbursed Partnership Expenses Any interest allocated to proceeds used for personal purpo-
ses is generally not deductible.
You can deduct unreimbursed ordinary and necessary partner-
ship expenses you paid on behalf of the partnership on Sched- For more information on allocating and reporting these in-
ule E if you were required to pay these expenses under the part- terest expenses, see Notice 88-37 in Cumulative Bulletin
nership agreement. You can only deduct unreimbursed expen- 1988-1. Also, see Notice 89-35 in Cumulative Bulletin 1989-1.
ses on Schedule E that are trade or business expenses under Owners of S corporation stock and debt. If you report a
section 162. Don't report unreimbursed partnership expenses loss, receive a distribution, dispose of stock, or receive a loan
separately if the expenses are from a passive activity and you repayment from an S corporation, you must check the box in
are required to file Form 8582; otherwise, do the following. column (e) on line 28 and attach the required basis computa-
• Enter unreimbursed partnership expenses from nonpas- tion. For more information, see Basis rules for S corporations,
sive activities on a separate line in column (i) of line 28. Do not earlier.
combine these expenses with, or net them against, any other
amounts from the partnership.
• If the expenses are from a passive activity and you are not
required to file Form 8582, enter the expenses related to a pas- Part III
sive activity on a separate line in column (g) of line 28. Do not Income or Loss From Estates and Trusts
combine these expenses with, or net them against, any other
amounts from the partnership. If you are a beneficiary of an estate or trust, use Part III to re-
• Enter “UPE” in column (a) of the same line. port your part of the income (even if not received) or loss. You
should receive a Schedule K-1 (Form 1041) from the fiduciary.
Your copy of Schedule K-1 and its instructions will tell you
Line 28
where on your return to report the items from Schedule K-1.
For nonpassive income or loss and passive income or losses for Do not attach Schedule K-1 to your return. Keep it for your re-
which you are not filing Form 8582, enter in the applicable col- cords.
umn of line 28 your current year ordinary income or loss (after
applying any special rules that limit losses) from the partner-

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If you are treating items on your tax return differently from line 4. Enter “Sch Q” on the dotted line to the left of this
the way the estate or trust reported them on its return, you may amount on Form 1040, 1040-SR, or 1040-NR, line 15; and
have to file Form 8082. Form 6251, line 4, if applicable.

If you have estimated taxes credited to you from a trust Note. These rules also apply to estates and trusts that hold a
(Schedule K-1 (Form 1041), box 13, code A), enter “ES pay- residual interest in a REMIC. Be sure to make the appropriate
ment claimed” and the amount on the dotted line next to entries on the comparable lines on Form 1041.
line 37. Do not include this amount in the total on line 37. In-
stead, enter the amount on Form 1040, 1040-SR, or 1040-NR, Do not include the amount shown in column (c) in the
line 26. ! total on Schedule E, line 39.
CAUTION
A U.S. person who transferred property to a foreign trust Column (e). Report the amount(s) shown on Schedule(s) Q,
may have to report the income received by the trust as a result line 3b.
of the transferred property if, during 2024, the trust had a U.S.
beneficiary. See section 679. An individual who received a dis-
tribution from, or who was the grantor of, or transferor to, a
foreign trust must also complete Part III of Schedule B (Form Part V Summary
1040) and may have to file Form 3520. In addition, the owner
of a foreign trust must ensure that the trust files an annual in- Line 42
formation return on Form 3520-A. Special estimated tax rules may apply if you have gross farm-
ing or fishing income. You will not be charged a penalty for
underpayment of estimated tax if:
Part IV 1. Your gross farming or fishing income for 2023 or 2024
is at least two-thirds of your gross income; and
Income or Loss From Real Estate Mortgage 2. You file your 2024 tax return and pay the tax due by
Investment Conduits (REMICs) March 3, 2025.
If you are the holder of a residual interest in a REMIC, use Part For details, see chapter 15 of Pub. 225.
IV to report your total share of the REMIC's taxable income or
loss for each quarter included in your tax year. You should re- Paperwork Reduction Act Notice. We ask for the informa-
ceive Schedule Q (Form 1066) and instructions from the RE- tion on this form to carry out the Internal Revenue laws of the
MIC for each quarter. Do not attach Schedule(s) Q to your re- United States. You are required to give us the information. We
turn. Keep it for your records. need it to ensure that you are complying with these laws and to
allow us to figure and collect the right amount of tax.
If you are treating REMIC items on your tax return differ- You are not required to provide the information requested
ently from the way the REMIC reported them on its return, you on a form that is subject to the Paperwork Reduction Act un-
may have to file Form 8082. less the form displays a valid OMB control number. Books or
If you are the holder of a residual interest in more than one records relating to a form or its instructions must be retained as
REMIC, attach a continuation sheet using the same format as long as their contents may become material in the administra-
in Part IV. Enter the combined totals of columns (d) and (e) on tion of any Internal Revenue law. Generally, tax returns and re-
Schedule E, line 39. If you also completed Part I on more than turn information are confidential, as required by section 6103.
one Schedule E, use the same Schedule E on which you entered The time needed to complete and file this form will vary de-
the combined totals in Part I. pending on individual circumstances. The estimated burden for
individual taxpayers filing this form is included in the esti-
REMIC income or loss is not income or loss from a passive
mates shown in the instructions for their individual income tax
activity.
return. The estimated burden for all other taxpayers who file
Note. If you are the holder of a regular interest in a REMIC, this form is approved under OMB control number 1545-1972
do not use Schedule E to report the income you received. In- and is shown next.
stead, report it on Form 1040 or 1040-SR, line 2b.
Recordkeeping. . . . . . . . . . . . . . . . . . . . . 3 hr., 39 min.
Column (c). Report the total of the amounts shown on Sched- Learning about the law or the form. . . . . . . . . 2 hr., 16 min.
ule(s) Q, line 2c. This is the smallest amount you are allowed Preparing the form . . . . . . . . . . . . . . . . . . 3 hr., 25 min.
to report as your taxable income (Form 1040, 1040-SR, or Copying, assembling, and sending the form to
1040-NR, line 15). It is also the smallest amount you are al- the IRS. . . . . . . . . . . . . . . . . . . . . . . . . . 34 min.
lowed to report as your alternative minimum taxable income
(AMTI) on Form 6251, line 4.
If the amount in column (c) is larger than your taxable in- If you have comments concerning the accuracy of these time
come would otherwise be, enter the amount from column (c) estimates or suggestions for making this form simpler, we
on Form 1040, 1040-SR, or 1040-NR, line 15. Similarly, if the would be happy to hear from you. See the instructions for the
amount in column (c) is larger than your AMTI would other- tax return with which this form is filed.
wise be, enter the amount from column (c) on Form 6251,

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