25,000 deduction limitations

[Account Closed]

ok trying to figure out the limitations on the up to 25,000 loss on rental properties.  

So let’s say married and over 150,000 in annual income.  Does that automatically mean I can’t take a lose at all and any loses roll into the next years taxes?  Or if my spouse is a real estate professional (she isn’t this year) then does the income restriction get removed?   Thanks I think it’s CPA time this tax season, it’s getting more complex then I can manage myself. 

[Ashish Acharya]

Originally posted by @Account Closed:

ok trying to figure out the limitations on the up to 25,000 loss on rental properties.  

So let’s say married and over 150,000 in annual income.  Does that automatically mean I can’t take a lose at all and any loses roll into the next years taxes?  Or if my spouse is a real estate professional (she isn’t this year) then does the income restriction get removed?   Thanks I think it’s CPA time this tax season, it’s getting more complex then I can manage myself. 

 Yes, its your AGI, not income. For most people income will be same as AGI, but  If you are self employed, then there are various deduction that might bring down your AGI below 150. 

If your AGI still more than 150k, yes your renal loss are carried forwarded to next year and subjected to same limitations. 

If your spouse qualifies as RE, then you can deduct renta losses that meet material participation requirement. Being RE professional automatically doesn’t make rental loss deductible. You have to materially participate in the rental activity to change the passive rental into non passive. 

The Material participation is different compared to the active participation that is required for 25k loss that you mentioned above.