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Tax question - Limitation on rental losses
Posted on 3/11/12 at 11:15 am
Posted on 3/11/12 at 11:15 am
I own rental property and every year I have been able to receive anywhere from $3k-$5k back at tax time recognizing my rental expenses, depreciation, etc. Well, since my wife went back to work in 2011, her income has now pushed us over the $150k mark and now I cannot recognize any losses?? This is crap.
Here is what Form 8582 states: "Generally, if your modified adjusted gross income is $150,000 or more, there is no special allowance."
Is there any way around this "generally" statement? I was really counting on this rebate. Our gross salary should have no bearing on me losing my arse in a rental property while the economy is in the toilet. This really sucks.
Here is what Form 8582 states: "Generally, if your modified adjusted gross income is $150,000 or more, there is no special allowance."
Is there any way around this "generally" statement? I was really counting on this rebate. Our gross salary should have no bearing on me losing my arse in a rental property while the economy is in the toilet. This really sucks.
2
Posted on 3/11/12 at 1:58 pm to Htown Tiger
are you or your wife in the real estate biz? agent, developer or anything?
if not you will probably just have to add it to your cost basis when you sell
if not you will probably just have to add it to your cost basis when you sell
This post was edited on 3/11/12 at 2:04 pm
Posted on 3/11/12 at 4:04 pm to Htown Tiger
must be something new. I took it last year when i rented out my home.
Posted on 3/11/12 at 5:04 pm to C
Don't you have to show a gain after a certain amount of years?
Posted on 3/11/12 at 8:03 pm to LSU1018
ianae, but unless you are in the real estate biz this is what i believe is considered a passive loss.
You don't really lose the deduction you are just not able to take it in the current year, you carry it over from year to year until you either have enough positive income from the property to use it or you sell the property.
You don't really lose the deduction you are just not able to take it in the current year, you carry it over from year to year until you either have enough positive income from the property to use it or you sell the property.
Posted on 3/11/12 at 9:49 pm to Dreamweaver
Yeah I dont think I pass the "real estate professional" test. Bummer. Thanks for the responses.
Posted on 3/12/12 at 10:28 am to Htown Tiger
Would filing married, but separately help? You could claim the losses on your own return and have income below $150k, and she'd likely get money back as well since her income wouldn't be taxed at the highest rate, but as if she made $30k or whatever. I've never filed seperately before, so I'm not entirely sure how you're able to split up expenses like this...but would it be worth looking into?
Posted on 3/12/12 at 12:10 pm to Bacchus
no.
MFS will be limited to 12500 per spouse. the phaseout begins at 50,000, and one spouse's passive loss cannot be offst by the other spouse's passive income.
This all assumes that the spouses lived apart for the entire year. If they did not, then the special allowance is zero.
MFS will be limited to 12500 per spouse. the phaseout begins at 50,000, and one spouse's passive loss cannot be offst by the other spouse's passive income.
This all assumes that the spouses lived apart for the entire year. If they did not, then the special allowance is zero.
Posted on 3/12/12 at 1:26 pm to simonizer
what are your long term plans with the property?
Posted on 3/12/12 at 8:28 pm to aaronb023
Sell as the soon as possible- but considering it's underwater and in the market sucks where it's located, that might be 10 years.
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