Why does TurboTax allow you to deduct losses from an STR against W2 income (even when not a real estate professional)?

danielhladd — Wed, 03 Dec 2025 21:27:09 GMT

Re: Why does TurboTax allow you to deduct losses from an STR against W2 income (even when not a real estate professional)?

AmeliesUncle — Mon, 08 Dec 2025 19:52:23 GMT

Did the property also have personal-use days? If so, was it 100% personal then converted to 100% rental (or the other way around)? Or was it back-and-forth between personal and rental?

If you "Materially Participate" in a short-term rental, it is non-passive, which means losses CAN offset W-2 income (even when not a Real Estate Professional).

However, in prior years I don't think TurboTax has had the ability to correctly do it (without manually doing something on the desktop version). That is why I started off asking about personal days, in case that (or something else) is triggering it be non-passive (but depending on your circumstance, that could possibly cause other errors though).

topic Why does TurboTax allow you to deduct losses from an STR against W2 income (even when not a real estate professional)? in Deductions & credits

Why does TurboTax allow you to deduct losses from an STR against W2 income (even when not a real estate professional)?

Re: Why does TurboTax allow you to deduct losses from an STR against W2 income (even when not a real estate professional)?