Posted by JHyre in Ohio on January 08, 2003 at 07:22:43:
Off the top of my head, I’d say it’s a rental activity because you are receiving payments for the use of property…given that the options expire quickly, your inability to use the loss to offset income sounds quite temporary. I DO think that the activity could qualify him as an “RE Professional” if he has the requisite amount of time in the activity, so you still might be able to take the losses this year.
John Hyre
John Hyre
Schedule C or Schedule E??? - Posted by Nicole K.
Posted by Nicole K. on January 07, 2003 at 19:24:52:
My husband started doing sandwich lease purchases in 2002. The tennant-buyers purchase an option from us to buy the property after a year. I assume that he has no “interest” in the rental activity that would qualify for the RE professional. We have a loss this year because all of the option deposits that we recieve are not included in taxable income until the option is used or expires and we have a lot of initial advertising and marketing costs. Is my husband providing a service (i.e. property management) for the owners and therefore would we file a schedule C and be able to offset his loss against my wages… or is rental income ALWAYS passive unless you qualify as a RE Professional.