Life isn't exactly easy for most real estate professionals these days. But real estate pros who own rental property have one thing going for them that others don't: special tax advantages. Let's say that you are a rental property owner and you spend more on the property than you earn during the year -- a depressingly common occurrence these days. Naturally, you'd like to be able to deduct your loss from any nonrental income you have, thereby reducing your taxable income and lowering your taxes for the year. Unfortunately, losses from real property rentals are classified as "passive activity losses." Special passive activity loss rules greatly limit the amount of losses that a rental property owner can deduct from other nonpassive income, such as salary or other busine...
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