Question I am retired and in a position to get a real estate license. Will that help me with a $200,000 loss on the sale of a beach house that I own? I can hold the property for a while if necessary. Also, I can rent the property myself. The property has been used as a personal beach house for several years and it has never been for rent.
Answer In order to convert the loss on this property from a nondeductible personal loss on the sale of a personal asset to a deductible loss on the sale of a business/income producing asset you would have to convert it to a bona fide rental property.
This means it would have to be rented out at fair market value for at least a year in order to survive an IRS audit challenge.
