@rmjones40 wrote:
Can you use rental property losses to offset realized capital gains from selling stocks and bonds?
There are two kinds of passive activities that give rise to passive losses:
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Trade or business activities in which you don’t materially participate during the year.
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Rental activities, even if you do materially participate in them, unless you’re a real estate professional.
https://www.irs.gov/publications/p925#en_US_2019_publink1000296799
You can only deduct passive losses from passive income (with the exception of the special $25,000 allowance - see link below) and capital gains are not passive income but, rather, are taxed at their own (capital gains) tax rate.
$25,000 allowance: https://www.irs.gov/publications/p925#en_US_2019_publink1000104571
