Self employed, meet IRS def of real estate professional too. How to take losses?

[Jessica Ferraro]

I'm self employed, but last year my duplexes took priority and earned me the distinction of meeting the IRS definition of a real estate professional. I'd like to take advantage, but I can't see how to do so. I have losses on my duplexes, as they're new and in the works, and I want those losses, which are not passive and should qualify as expenses against wages because of my RE pro status, to count against my self employment income. But I cannot see how or where to do that on the IRS forms. Any help out there?? Someone else come up against this themselves or working with a tax client? I've stumped a tax pro already...Thanks in advance for help.

[Chris Picciurro]

You can deduct your real estate losses in the same year you qualify for REP status. Usually you pair a cost segregation study with REP status. Prior year passive activity losses will not be deductible unless your adjusted gross income is low enough to release them. REP status is not reported on a designated form yet reflected on your personal return and related schedules.