To qualify under the passive activity rental real estate exception, the taxpayer must (1)own at least 15 percent of the property and (2)participate in the process of making management decisions.

Question

Quizplus · Accepted Answer

The passive activity rental real estate exception does not specify that the taxpayer must own at least 15 percent of the property. The key criteria are active participation and a specific level of material participation in the property's management, not a specific ownership percentage.

To Qualify Under the Passive Activity Rental Real Estate Exception