Newbie 1099-Misc Question

[Tony Kim]

I received a 1099-Misc from my property manager for tax year 2018. This is the first time I've ever purchased an out of state property that is professionally managed.

Doesn't receiving a 1099-Misc mean that the income is no longer passive income? I'm not referring to the actively participate/10% ownership situation that allows for a 25K deduction. I'm referring to the basic understanding that real estate investing and rental activities for folks who have full time jobs in other industries are passive and gains in one property can be offset with losses from other properties or K-1's. But now that I have received a 1099 from my PM, I'm worried that this income is no longer considered passive.  

I was under the impression that earnings reported via 1099 were not considered passive, but instead considered ordinary income?? Is this incorrect?

When I enter this information in TurboTax under the 1099-Misc income section, I see my tax due amount spin upward despite the fact that I have accumulated nearly 70K in passive losses this year.

Or, instead of entering this 1099-Misc income in TurboTax under the 1099 section, do I simply add it as another asset in Schedule E and use the gross amounts provided in the 1099 as my gross rents?

If I do it this way, would that trigger something with the IRS? I thought one of the basic filters the IRS ran was to check to see if the taxpayer's aggregate W-2 and 1099's reconciled with their records?

I guess what I am ultimately asking is where in TT do I enter the 1099-Misc information I received from my PM.

Thanks in advance for your help!