What Is “Opportunity zone”?
06/01/2026
An Opportunity zone (often referred to as a Qualified Opportunity Zone or QOZ) is a specific, government-designated community where new private investments qualify for significant tax benefits. By investing your capital gains into a specialized fund that funds projects or businesses in these distressed or rural areas, you can legally defer, reduce, and eventually eliminate
What Is “Qualified opportunity fund”?
06/01/2026
A Qualified opportunity fund (often called a QOF) is a special investment vehicle created to encourage financial investment in economically distressed communities. By rolling your prior capital gains into a QOF, you can temporarily defer paying taxes on those profits. Even better, if you leave your money in the fund long enough, any new profit
What Is “Net rental loss”?
06/01/2026
A net rental loss occurs when the total deductible expenses for your rental property exceed the total rent you collected during the tax year. For tax purposes, this means your property operated at a loss, allowing you to potentially offset other income and lower your overall tax bill. Because of non-cash deductions like depreciation, a
What Is “Net rental income”?
06/01/2026
Net rental income is the total amount of money you collect from a rental property minus all of your allowable deductible expenses. It is the final profit or loss from your rental activity that you report to the IRS. Essentially, it is the bottom-line number that determines how much tax you will owe on your
What Is “Self-rental rule”?
06/01/2026
The self-rental rule is an IRS tax regulation that applies when you rent property you own to a business in which you actively work. Under this rule, any profit you make from the rental is taxed as active (non-passive) income, but any loss you suffer remains a passive loss. The IRS designed this rule to
What Is “Suspended passive loss”?
06/01/2026
A suspended passive loss is a financial loss from a passive business activity—such as a rental property—that you cannot deduct on your current year’s tax return because you do not have enough passive income to offset it. Instead of losing the tax deduction entirely, the IRS allows you to “suspend” the loss and carry it
What Is “At-risk rules”?
06/01/2026
The at-risk rules are IRS tax guidelines that limit the amount of business or investment losses you can deduct on your tax return. They ensure that you can only deduct a loss up to the actual amount of money or property you personally stand to lose in an activity. In short, you cannot claim a
What Is “Real estate professional status”?
06/01/2026
Real estate professional status (often called REPS) is a special tax classification created by the IRS for taxpayers who spend the majority of their working time in real estate businesses. Qualifying for this status allows you to treat rental real estate losses as “non-passive,” meaning you can use them to offset your ordinary income, such
What Is “Active participation”?
06/01/2026
Active participation is a special IRS tax classification for real estate investors who are involved in managing their rental properties. By meeting this relatively easy standard, landlords can unlock a tax break that allows them to deduct up to $25,000 of rental real estate losses against their ordinary income, like their salary. This is a
What Is “Material participation”?
06/01/2026
Material participation is a set of criteria used by the IRS to determine whether a taxpayer is actively involved in the regular, continuous, and substantial operations of a business or rental activity. If you meet the material participation standards, the activity is considered “active,” allowing you to deduct business losses against other income streams like