benefits of real estate professional .

[Deepika Tandon]

I would like to know the tax benefits of the RE Professional . Me and my husband both work full time. We are upto 19 units and flipped 2 houses so far. We do have property management in place for our 12 -plex and 4-plex. Others we manage ourselves. What do we need to do to qualify for a RE professional and what are the tax benefits if we do? Please share the info on this. 🙏 thanks 🙏

[Ashish Acharya]

@Deepika Tandon , 

RE pro becomes helpful if you have a loss from your RE investments/Business. If you dont expect a loss, it does not matter. 

It is possible to qualify for RE pro even with the full-time job, but have to be carefully planned. People have done it. 

Without RE pro status, If your AGI is below 100k, you can deduct 25k in a loss and the deduction phased out and is completely gone after 150k. I am guessing with two W-2 income you guys are over the 150k AGI, which means you cannot deduct any Rental losses unless you qualify as RE pro. If you do have the loss, you can deduct the entire loss against your W-2 income if you are RE pro. 

Qualifying for RE pro has its own complicated rules.  First lets see if you actually have a loss.