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Qualifying as a real estate professional can provide you with several tax deductions you may not know about. Learn the qualifications and tax benefits at FortuneBuilders.
- JD Esajian
Sep 9, 2020 · Qualifications. You qualified as a real estate professional for the year if you meet both of the following requirements: More than half of the personal services you performed in all trades or businesses during the tax year were performed in real property trades or businesses in which you materially participated.
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May 6, 2024 · Many individuals who own real estate investments also hold full-time W-2 jobs. Achieving real estate professional status (REPS) can be challenging when balancing the obligations of both a full-time job and real estate activities. The IRS routinely audits taxpayers who report W-2 earnings and tax losses from real estate professional status.
By Sherman Standberry, CPA. This article is Tax Professional approved. The real estate professional tax status changes your rental income from passive to ordinary income. Qualifying for this status is the gateway to substantial tax savings for many real estate investors.
Apr 1, 2022 · April 1, 2022. There are many tax advantages involved in real estate ownership, however, there are additional perks available to those who qualify as real estate professionals.
5 days ago · There are two requirements detailed in IRS Publication 925 that can qualify you as a real estate professional. You must meet both requirements to receive the tax status: 50% or more of your time is spent in real estate activities than non-real estate activities and. You spend at least 750 hours a year performing real estate activities.
Apr 14, 2021 · Real estate professional tax deductions. Qualifying as a real estate professional can produce huge tax benefits. When you qualify as a real estate professional and materially participate in your own rental activities, your rentals will be considered “non-passive.” You or your spouse’s W-2 income and your business income are “non-passive.”
