Wife is Real Estate Professional but Properties are jointly owned

[Shaun Ng]

Hi BP community, I need some advice.

Through advice here, my wife is a real estate professional starting 2 years back. But some of our properties are jointly owned. 

We have not been claiming losses from those properties that are jointly owned, against my W2 income, as I was told by a CPA in the past that as long as my name is on the property, (even though my spouse is also on the property), the losses are not allowed. I recently heard from another CPA that this is not the case. As long as my wife's name is on the property, and she is a real estate professional, the losses on the property is 100% deductible against my W2 income.

Who is correct?

Confused, Shaun

[Eamonn McElroy]

@Shaun Ng

As long as your wife is an RE pro, and she materially participates in the rental real estate activities, the losses are non-passive.

Sounds like your current CPA is doing you a disservice based on what you laid out above.