One exception: if you're claiming the notorious "RE Pro" status to get around limitations on deducting losses - then you absolutely become a "trade or business" and must obey the 1099 rules.

@Elizabeth Garcia, it adds an extra (unnecessary) step to the process.

If you did you take on the responsibility for the loss.

Can anyone tell me whether the new tax law kept the current passive activity loss limit?

When speaking with a lender, he indicated that if I take a loss on the rental, the income would not count, which would obviously increase my DTI dramatically.

Just make sure the contractor runs a heat load/loss calculation to properly size your system.

So, you need to take some classes on entrepreneurism to adjust and expand your paradigm into "How much income will it produce / loss will it prevent?".

I have now added a termination fee and all of my leases which helps protect against vacancy losses.

If the dwelling unit is considered home, then the amount of rental expense you can deduct is limited.You cannot report rental expenses that are more than your gross rental income, although the losses can be carried forwarded.Rules:The dwelling unit is considered home if you use a unit for the personal purpose more than the greater of:1.14 days or2.10% of the today days it rented to other at fair market value.If you meet the criteria above, which you will as this is your house, your property is considered home there are two scenarios:1.Home rented for less than 15 days: Do not report any income or expense.

I know I can withhold the loss in rent.