Kathy is a full-time educator, but she owns an apartment building and devotes 550 hours to managing the activity. All losses from the rental activity will be considered nonpassive and deductible against active income because she is a real estate professional.

Question

Quizplus · Accepted Answer

To be considered a real estate professional, Kathy must spend more than 750 hours and over half of her working time in real estate activities. Simply managing 550 hours does not meet the criteria.

Kathy Is a Full-Time Educator, but She Owns an Apartment