April 18 is Election Day! Tax Elections, that is

[Bruce D. Kowal]

April 18 is Election Day!  It's the day you must make your election to be  Qualified Real Estate Professional.  This is IRC §469(c)7)(A).

You really need to see a CPA to think this through.

What you doing is combining real estate interests in one Activity.  

So what?  You may ask . . .Here's the deal:

Being an REP under the Tax Code means that rental activities are no longer considered to be passive income generators, and therefore they produce non-passive income and losses [a good thing].

Further, unlike passive losses, non-passive losses can be used to offset other types of income [a good thing].

But that activity must be a "rental activity".

The "Election" itself is simply a statement attached to you timely-filed tax return.  That mean you filed by April 18, 2022, or by the extended due date of October 15, 2022.

Here's a possible wording of the election.  There is no authoritative wording for this:

I hereby make an election pursuant to Section 469(c)(7)(A) of the Internal Revenue Code. I am a qualified taxpayer and elect, pursuant to IRC Section 469(c)(7)(A) to treat all of my interests in rental real estate as a single activity starting with my 2021 tax return.

Now, because this is so significant, you may want to chew over this.  That's fine.  File your extension.  Pay what taxes are due by April 18.  

And over the Spring and Summer you can model this with your CPA.

It's Election Day!!!

(Has anyone made a lapel pin that says "I am a Qualified Real Estate Professional"?  Or a bumper-sticker?)