Even I tend to get confused at times, between the "material participation" requirement, and the "actively involved" requirement. If you check out IRS Pub 527 Chapter 3 page 13, section "Passive Activity Limits" here you'll see the requirement to be a real estate professional that materially participates as such. So being only actively involved is not always enough. So unless something in IRS Pub 295 applies, the ability to claim passive income against other ordinary income may not be possible.
