$25,000 Special Allowance for Rental Real Estate Activities With Active Participation

[Jonathan Small]

I am thankful and looking for feedback from our professional tax preparers. 

My wife and I don't qualify for real estate professional status.  We make over 150k a yr.  We have 5 rentals in seperate LLCs that have created losses on our return. The rentals are not in the same state we live in. We self manage 2.  We have separate property managers for the other 3.  I want to understand the 25k special allowance. I have received 3 different but similar explanations from tax professionals. They may be saying the same, but when I hear the explanation I lose what understanding I thought I had.

1.  Are we limited to 25k in losses?  Line 11 on my return has more than 25k in losses.

2.  We don't qualify for real estate professional status. If we did, how does this impact this topic if at all?

3. Feel free to answer any other questions I should be ask but not smart enough to realize it 😀