Under the passive loss rules, real estate rental activities are specifically defined as passive, even if the taxpayer actively manages the property.

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The passive loss rules do specifically define real estate rental activities as passive, even if the taxpayer actively manages the property. This means that losses from real estate rental activities cannot be used to offset income from other sources, unless the taxpayer meets certain criteria, such as being a real estate professional.

Under the Passive Loss Rules, Real Estate Rental Activities Are