Are You a Full-Time Real Estate Investor? Maybe not.

In This Article

Welcome to Real Estate Tax Season!
In an article in the Wall Street Journal, Real-Estate Professionals Say IRS Snares Them by Mistake, we learn that the IRS is watching . . .

Given all the real estate investors and speculators who appeared during the fast fading real estate bubble-boom, the IRS has decided to look closer at real estate professionals. full-time real-estate professionals, defined as someone who spends more than half of his working hours in real estate and more than 750 hours a year tending to real-estate activities, can fully deduct losses — including depreciation, interest expense on loans and property taxes.

But those who don’t fit into that category are typically considered to be “passive” real-estate investors with a limited ability to deduct their losses, says Alan Weiner, a CPA and tax partner at the firm of Holtz Rubenstein Reminick LLP in Melville, N.Y.

Are you a full-time real estate professional?

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