IRS Form 8582 (Passive Activity Loss) - Special Allowance Limits for Rental Real Estate

Rental real estate activities are "per se" passive activities. If a taxpayer actively participates in the rental real estate activity, and the activity operates at a net taxable loss for the period, the taxpayer may be able to claim the Special Allowance for Rental Real Estate activities and deduct up to $25,000 of those passive losses against nonpassive income.
In this example, we have a taxpayer with a single-family home rental property where he actively participates in the management. The taxpayer can claim the special allowance and deduct the losses against his nonpassive income. However, given the taxpayer's modified AGI, the special allowance is limited. The unallowed rental real estate losses are carried forward to the next tax year.
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[@hassanabdellah8778]

excellent. thank you

[@JasonDKnott]

You are welcome!

[@alexcolombu1025]

another great video by the master of taxes. hey have you ever thought about doing shorts?

[@carrie4579]

How about not allowable loss of $3821? Does it treat as carryover loss for the coming year? So part VIII(b) is the data needs to enter for at line 2 (c) on 8582 for the current year return?

[@lettruthprevail9820]

Is a real estate appraiser considered to be a real estate professional?

[@Team8LA]

Hi Jason, what if a person doesnt have W2 income? How to report this 25k loss? Tia!

[@Deimian676]

FTB 3801?