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

[AmeliesUncle]

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).