This sucks!! Tax Laws are &^%$

[Jak Dadi]

The last week has been depressing as we went through a prelim exercise to understand our tax situation. We have a MAGI of over $150k through 2 W-2's, live in a rented house and own a few multi-families. We made a rental loss last year since the properties were purchased in second half of the year, but as we went through the tax exercise, we find out that we are not able to write off the losses because of our MAGI. Even though I easily spent more than 750 hours last year on real estate investing, it is still counted as passive activity because of our W-2's.

Does anyone else have this same experience? One CPA we talked to said we should buy a primary home first, which in our neighborhood would be over $1M. We wanted to build some assets before we took on such a liability. We are meeting with 2 other CPA's to get their inputs. For us, the thought of financial freedom and generating enough cash flow to replace our salaries is the primary driver, not to mention, real estate investing is now a full time passion/obsession etc.

Anyone in similar situation??????