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Tax Glossary
What Is “Self-rental rule”?
The self-rental rule is an IRS tax regulation that applies when you rent property you own to a business in...
Tax Glossary
What Is “Suspended passive loss”?
A suspended passive loss is a financial loss from a passive business activity—such as a rental property—that you cannot deduct...
Tax Glossary
What Is “At-risk rules”?
The at-risk rules are IRS tax guidelines that limit the amount of business or investment losses you can deduct on...
Tax Glossary
What Is “Real estate professional status”?
Real estate professional status (often called REPS) is a special tax classification created by the IRS for taxpayers who spend...
Tax Glossary
What Is “Active participation”?
Active participation is a special IRS tax classification for real estate investors who are involved in managing their rental properties....
Tax Glossary
What Is “Material participation”?
Material participation is a set of criteria used by the IRS to determine whether a taxpayer is actively involved in...
Tax Glossary
What Is “PAL rules”?
The term “PAL rules” stands for Passive Activity Loss rules. These are IRS regulations that prevent taxpayers from using losses...
Tax Glossary
What Is “Passive activity loss”?
A passive activity loss occurs when the expenses from a hands-off business or rental property exceed the income it generates....
Tax Glossary
What Is “Depreciation of rental property”?
Depreciation of rental property is a tax deduction that allows real estate investors and landlords to recover the cost of...
Tax Glossary
What Is “Rental expense”?
A rental expense is a cost incurred to manage, maintain, or operate a rental property, or a cost a business...