Rental property

Forum|Forum|4 years ago
March 9, 2022
1 reply
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I have a loss on rental property. Can I use it to offset capital gains on investments?

RobertB4444

Level 15

A loss on rental property is used to offset regular income. It will reduce your overall income provided you earn less than $100,000 per year or you are a real estate professional. The maximum loss that you can deduct is $25,000.

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Burkemper58Author

Level 2

I have earnings under 100K but my capital gains on investments are greater than 100K. Can I still deduct a loss on rental income?

JohnB5677

Level 15

Capital gains are included in the modified adjusted gross income, or MAGI.

Under the passive activity rules, you can deduct up to $25,000 in passive losses against your ordinary income (W-2 wages) if your modified adjusted gross income (MAGI) is $100,000 or less.

This deduction phases out $1 for every $2 of MAGI above $100,000 until $150,000 when it is completely phased out.

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