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Updated almost 4 years ago,

Account Closed
  • Investor
  • Dallas, TX
14
Votes |
15
Posts

Can someone help me define what "Active" Real Estate Investor

Account Closed
  • Investor
  • Dallas, TX
Posted

I know this really sounds like a dumb question. My husband and I acquired our first rental property last year and we got very few write off's and our tax bill in general was very high.  I tried to do some research. 

I watched Mark Kohler's video on tax strategies and LLC's and he talks about 3 types of investors: Passive, Active, and Professional. I believe now that I fell into the passive category, and if I were to move into the active category then it would have more financial benefits and tax shelters. But, how do you define what "active" is? How does the government define "active"? How can I move into the Active category and start to reap the benefits of better write off's? (side note: We are selling our home in CA and moving to TX next month, DFW area-so not sure if location helps. Thinking about acquiring more properties and putting them into a series LLC which is allowed in TX but not in CA).

Any advice, podcasts, book recommendations also welcome, thanks!

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