I am a full time real estate investor and property manager. My wife is a Real Estate Agent. Turbotax says we are not real estate professionals!!! Why?

[arvoreis]

we worked over 4000 hours in real estate last year actively managing our rentals, investments, renovations, and brokerage. turbotax is saying we are not real estate professions. If we are not I can't imagine who would be. This is a very expensive difference!

please advise, thank you

[RichardG · Accepted solution]

You must be able to answer yes to both questions to qualify as a real estate professional.  Only time spent on real estate activities count.  Time spent managing your investment portfolio does not count toward the requirements.  Also, if your wife is a W-2 employee of the real estate firm (this is uncommon), her time doesn't count unless she has an ownership interest in the firm.  

Please follow this link for more information.  https://www.irs.gov/instructions/i1040se/ch01.html#d0e234

[arvoreis]

thank you so much. I clicked both buttons and my taxes due went down by 25k 🙂