"Active participation" and "real estate professional" are both exceptions to the general rule for passive activity losses with rental real estate.
I.One of the tests that a taxpayer must meet to qualify as a real estate professional is that the taxpayer spend more than 50% of his or her time in real property trades or businesses in which he or she materially participates.II.A taxpayer with an AGI of $190,000 qualifying under the real estate professional exception may deduct an unlimited amount of rental real estate losses.?
A. Only statement I is correct.
B. Only statement II is correct.
C. Both statements are correct.
D. None of the statements are correct.
Answer: A
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