How to Lower Your Tax Bill Episode 9

Real Estate & Taxes: How Short-Term Rentals Can Offset Your W-2 Income

In this episode of How to Lower Your Tax Bill, host Terrence Hutchins, a financial and tax advisor in the Dallas-Fort Worth area, explains how W-2 employees can leverage short-term rentals (STRs) to reduce their taxable income. Many new real estate investors expect immediate tax benefits—only to be caught by the passive activity loss rules. But by structuring rentals strategically, you can unlock deductible losses to offset your W-2 earnings.

Terrence covers:

• The three exceptions that allow real estate losses to offset W-2 income.
• The 7-day rule that distinguishes short-term rentals from passive real estate.
• Material participation tests and w ...