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Updated over 3 years ago,

User Stats

25
Posts
4
Votes
Kip Cline
  • Rental Property Investor
  • Sault Sainte Marie, MI
4
Votes |
25
Posts

Should I be a real estate professional status for tax purposes?

Kip Cline
  • Rental Property Investor
  • Sault Sainte Marie, MI
Posted

What are the downsides of electing to be treated as a real estate professional for taxes? Would this make my real estate rental income become active income instead of passive? Is this taxed differently? I do not have high income from other areas of work and my rentals all cash flow positively even after depreciation so I do not show any real estate losses that would offset income from other areas.

I am also a real estate agent, but only do half a dozen deals a year. Would this automatically make me have to be treated as a real estate professional?

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