Whether you qualify as a real estate professional will determine whether your rental income is passive or not. This will depend whether you pass the tests. You must not answer the question just in order to lower your taxes.
You are a real estate professional if all of the following are true:
- You materially participated in a real property trade or business.
- More than half of your time is involved in real estate activities during the year.
- You materially participated for more than 750 hours in this business.
- You materially participated in each rental real estate activity.
In Turbotax, you need to check both boxes saying that you spend more than 750 hours a year actively involved in real estate and that you spent more than 50% of your work-related time involved in real estate
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