Question

My spouse and I work together selling real estate. We just had another great year. Now we are thinking of buying rental property to help reduce our tax burden.

We asked our tax professional what he thought, and here’s what he said: “Buying a rental property would likely generate losses in the early years, but with your high income, the losses would be suspended and wouldn’t make any difference to your tax bill. You might be able to get around this by using an exception for people in the real estate business, but we would have to take special steps to make this happen.”

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