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A 1031 exchange, also called a like-kind exchange, is a real estate transaction where you trade a passive-income-generating property — a business-use property or one held as an investment ...
26 U.S.C. § 469 (relating to limitations on deductions for passive activity losses and limitations on passive activity credits) removed many tax shelters, especially for real estate investments. This contributed to the end of the real estate boom of the early-to-mid 1980s, which in turn was the primary cause of the U.S. savings and loan crisis.
If you’re a real estate professional, rental income is considered active income, allowing you to take advantage of certain deductions, such as income losses from rental real estate. Real estate ...
Passive income is often derived from work that one does not personally do. Stock-based dividends, for example, are typically based on regular business operations by real employees who are paid a salary for real work. But these dividends still serve as a passive income for stockholders, as the stockholder has done no physical work for this income.
Taxpayers who hold real estate as inventory, or who purchase real estate for re-sale, are considered "dealers". These properties are not eligible for Section 1031 treatment. However, if a taxpayer is a dealer and also an investor, he or she can use Section 1031 on qualifying like properties.
Here's how to use passive real estate investing in your portfolio. Investing in real estate can be a smart move if you're interested in creating new income streams. "Real estate can be a great way ...
Prior to 1987, passive investors in certain limited partnerships (such as oil exploration or real estate investment ventures) were allowed to use the passive losses (if any) of the partnership (i.e., losses generated by partnership operations in which the investor took no material active part) to offset the investors' income, lowering the ...
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