The real question is whether or not your Modified Adjusted Gross Income (MAGI), which is reported on your Form 1040, disqualifies you for the special allowance.

@June Yang I am a buy-and-hold investor and I just purchased my first property from a wholesaler.

"Management Decisions" consist of approving of new tenants, deciding on lease terms, approving expenditures, hiring contractors, etc.Limitations exist and center around your Modified Adjusted Gross Income (MAGI), which is reported on your Form 1040.

@Steven Yang Many people who live in expensive markets who look out of state to the "cash flow markets" look in the mid west.

@Lynn Yang I have the same question as Jeff above.

Hello Leon Yang Thanks for teaching me this neet link thing also ;)TY for the info.

While you might be a yin to their yang.

A giant Frocket reminds me a bit of @Leon Yang's story of his high school baggy pants earning him the nickname Penguin.

I think you are trying to ask if you can deduct real estate losses against ordinary income.Assuming you meet the IRS's activity rules and you are in fact an "active" participant, it really boils down to what your Modified Adjusted Gross Income (MAGI) is.

Welcome @Jaime Botello I agree with @Leon Yang I have read and meet people who lost it all when they got too aggressive.