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PDtax
PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4293
Experience:  35 years tax experience, including four years at a Big 4 firm.
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I am considered a real estate pro for my in state properties

Resolved Question:

I am considered a real estate pro for my in state properties but not my out of state properties so what is the deduction for the out of state properties if any at all
Submitted: 5 years ago.
Category: Tax
Expert:  PDtax replied 5 years ago.

PDtax :

Hi from Just Answer.

PDtax :

I believe your out-of-state real estate properties will be subject to the passive loss limitations.

PDtax :

The grouping should be all the properties subject to the passive loss limitations (the out of state ones). Your in state are not subject to that same limitation.

PDtax :

If that answers your question, please let me know by clicking

PDtax :

accept

PDtax :

If you need more information, let me know.

Customer:

Well I don't know how to go about the grouping is it as simple as sending a letter to the IRS? And does that mean I name it and file as one group ?

PDtax :

no. the passive activity loss limitation kicks in if you are not considered a real estate professional. I understand from your audit that IRS? did not consider you a professional for your out-of-state holdings (ostensibly because you could not commit the hours needed to personally manage

PDtax :

your out of state holdings).

PDtax :

Filing is the same as it has always been with one difference. In your listing of the properties, you don't select real estate professional for those properties. TurboTax or any good software will segregate those properties and group them for passive activity reporting (list each income/loss, group them all, subject the total to $25,000 passive loss to be allocated among the properties).

PDtax :

Let me know if you need more info...

PDtax and 2 other Tax Specialists are ready to help you