Enrolled Agent Exam [Part 1] 14, Passive Activity Loss Rules

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: • How passive activity losses (PALs) are generally only deductible against passive income, not active or portfolio income. • The mechanics of the special $25,000 loss allowance for individuals who actively participate in rental real estate. • The critical Modified Adjusted Gross Income (MAGI) phase-out range of $100,000 to $150,000 for the rental loss allowance. • The rules for carrying forward suspended passive losses and how they are fully released upon a taxable disposition of the activity. • How to meet the material participation standard, focusing on the 500-hour test, to reclassify an activity as non-passive. For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or Youtube Channel: https://www.youtube.com/@Open-exam-prep