Passive Loss Rules and Real Estate Professionals

NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card

This course explains the special rule that allows certain individuals to apply the material participation rules to real estate rental activities to avoid their classification as passive activities. Participants will learn how to determine material participation, qualify for real estate professional status, and apply strategies to maximize deductions while maintaining compliance. Gain practical insights to help clients optimize tax outcomes and avoid common pitfalls in rental property taxation.

Who Should Attend
This course is ideal for CPAs, enrolled agents, tax advisors, and real estate consultants who assist clients with rental property taxation and planning. Whether you manage individual returns or complex real estate portfolios, this session equips you with the tools and knowledge to deliver exceptional value and ensure compliance.

Topics Covered

• Quick §469 review
• Relevance and rationale of §469(c)(7)
• Key rules and terminology
• Grouping of rental real estate
• IRS Audit Techniques Guide on Passive Activities
• Sampling of court cases
• How §469(c)(7) interacts with other aspects of the passive activity rules and related rules, Including Sections 199A, 469 and 1411
• Recordkeeping considerations
• Tips for avoiding problems

Learning Objectives

• Identify how the §469(c)(7) "real estate professional" rule works
• Describe the rationale behind this special rule
• Identify the real estate rental grouping options and how to make a grouping election
• Recognize how to gain an appreciation of how to avoid problems in applying the special rule
• Explain common issues in applying the real estate professional rule

Level
Basic

Instructional Method
Group: Internet-based

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
None

Advance Preparation
None