Passive Activity Losses (PAL): Comprehensive Webinar

• Identify activities subject to the PAL rules and the exceptions to them, including those for certain real estate professionals.
• Define a passive activity, rental and trade or business under IRC Sec. 469.
• Outline seven ways to materially participate in an activity and six exceptions to the definition of a rental activity.
• Calculate the passive activity income and losses allowed and the tax ramifications of passive activity dispositions.
• Recognize what passive activity investments are potentially subject to the 3.8% net investment income tax under IRC Sec. 1411.

• How the PAL rules apply to rental real estate activities and investments in S corporations and partnerships.
• Definition of an activity and the activity grouping and disclosure rules.
• Real estate professional exception to the PAL rules for investments in non-passive rentals.
• Special $25,000 loss allowance for rental real estate with active participation.
• Material participation safe harbor rules.
• Events that trigger suspended PALs.
• Limitations on tax credits generated by passive activities.
• Special rules that re-characterize passive income to non-passive income.