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Group passive activities

Refer to Publication 925 and Form 8582 instructions to determine the treatment of passive activities and which activities you can group together.
You may be able to group passive activities together and group a non-passive activity with a passive activity. You'll need to enter passive information in the correct screen:
  • For Schedule C, use the
    C-3
     screen.
  • For Schedule E, page 1, use the
    Rent-2
     screen.
  • For Schedule E, page 2, part II, use the
    K1-7
     screen.
  • For Schedule E, page 2, part III, use the
    K1T-3
     screen.
  • For Schedule F, use the
    F-3
     screen.
  • For Form 4835, use the
    4835-2
     screen.
  1. To group passive activities together under Revenue Procedure 2010–13:
    1. Go to the passive activity information section for the activity you need to group.
    2. Use the
      Aggregation group
       in each activity.
    3. Enter the
      Group disclosure
       to specify the type of grouping for the disclosure statement.
      note
      The group number and passive activity code need to be the same in each grouped activity. Activities in the group will be combined as 1 aggregate activity on Form 8582. UltraTax CS will create the group disclosure statement and summary statement of activities in the group.
    4. If the activity is a significant participation activity, enter the
      Significant participation hours
       for each activity in the group.
  2. To group a non-passive activity with a passive activity:
    1. Use the
      Reg. 1.469-4(d)(1) group
      .
    2. Select the
      Group disclosure code
       in the passive activity information.
    note
    • The Group Disclosure Statement is produced for the grouping of a rental activity with a non-passive activity.
    • If the entire group is non-passive for reporting purposes, you'll need to give each activity a passive activity code that's non-passive. The group won't be reported on Form 8582.
    • If you group activities using the
      Reg. 1.469-4(d)(1) group
      , leave
      aggregation group
       empty for the activity.

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