Income Limitation For Passive Loss

Passive activity limits under the passive activity rules you can deduct up to 25 000 in passive losses against your ordinary income w 2 wages if your modified adjusted gross income magi is 100 000 or less.

Income limitation for passive loss. This deduction phases out 1 for every 2 of magi above 100 000 until 150 000 when it is completely phased out. Passive income is income from business activities in which you don t materially participate including other rental activities. As always is the case in tax law there are exceptions.