Real Estate Agents CAN CLAIM Special Tax Break

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Real Estate Agents CAN CLAIM Special Tax Break

Thursday, March 12

Tax Court ruled that licensed real estate agents' investment property losses ARE EXEMPT from the passive activity loss rules if the licensed real estate agent spends more than half of his or her time and at least 750 hours per year materially involved in his or her real estate business. This is the same rule that applies to investment property owners, developers and real estate brokers.

The IRS has always taken the position that real estate agents were not covered, but the Tax Court disagreed with the IRS's position Agarwal, TC Summ. Op. 2009-29.