Hi All,
Long time lurker here. I have read dozens of posts about REP status and it's still clear as mud to me. I am hoping someone educated can chime in on my specific situation.
I am a high income earner, owning a construction business that specializes in wineries and luxury residential. My wife is also a high income earner--she works in the hospitality and wine space. We are looking towards STRs in order to lower our W-2 taxable income via cost seg and bonus depreciation.
I believe my line of work qualifies me as a REP, but what I am not clear on is whether I would still need to meet the 'material participation' requirements in our rental business in order for our losses to be non-passive. I have read that qualifying as a REP doesn't mean your losses automatically become non-passive and that you still need to materially participate in the rental business in order for losses to become non-passive. Is this correct? Or does my business alone qualify me as a REP and allow me to take non-passive losses with STRs?
Thanks in advance!
