Primary residence and renting - 20% pass through deduction?

[Michael O'Brien]

I just bought my first house and was wondering if it would be beneficial to make it an LLC for the 20% pass through deduction. My girlfriend is paying half the mortgage which would come out to a bit over 5k per year. Should I make her a formal renter and setup an LLC for the deduction? However you cannot take the new standard deduction of ~12k on top of the 20% pass through deduction correct? If that’s the case then it would not be beneficial to do the above yet

[Michael Plaks]

Originally posted by @Michael O'Brien:

I just bought my first house and was wondering if it would be beneficial to make it an LLC for the 20% pass through deduction. My girlfriend is paying half the mortgage which would come out to a bit over 5k per year.

Should I make her a formal renter and setup an LLC for the deduction?

However you cannot take the new standard deduction of ~12k on top of the 20% pass through deduction correct? If that’s the case then it would not be beneficial to do the above yet

The 20% deduction is for businesses, including renting for income. You cannot (legally) create it on your personal residence, even with your girlfriend involved.