.: Quote from @Matthew Hamilton: When it comes to how income and losses show up on your tax return, everything generally falls into one of two categories: passive or non-passive. • Passive losses can only offset passive income.• Non-passive losses can offset both non-passive and passive income.W-2 income is non-passive, and in most cases, capital gains from selling investments (brokerage accounts, crypto, etc.) are also non-passive.Real estate losses, by default, are considered passive.There are two main ways to convert those real estate losses into non-passive losses (which is what you’d need to offset W-2 income):1.

If you bought it in 2023 you’re probably going to take a big loss if you sell.

Hi @Linda Cunliffe, If you sell to a relative below market, the IRS treats the discount as a gift, not a deductible loss.

Then I find out a week ago they sold the property at a loss, ALL my capital is gone, and Ken McElroy goes on his merry way making youtube videos about how much money he is making. 

As with all the other investors with CALM INVESTMENTS was never compensated for any of my losses, which was every penny put in his Company.

I later unloaded all those properties for a huge loss, and now I only invest passively.  

The STR loophole (terrible name as not really a loophole, but seems to be the common name) allows you to write ff passive losses.  

I sold the Class C with a capital loss and am selling the other Class C, both bought in 2023.

We've considered selling for a loss, or seller financing to a potential buyer.

You’re basically pulling future depreciation into this year.Two things to watch:Make sure the rentals are truly rental activities for passive vs nonpassive rules — big losses don’t help if you can’t use them.Get the study done by someone who actually knows residential rentals, not just big commercial.So: yes, you can do it now, yes, you can catch up, but no, you generally don’t get to go back and grab the old-year bonus as if you’d done the study in 2020.