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Passive activity

(Tax Law)

An activity involving the conduct of a trade or business in which you do not materially participate and any rental activity. However, the rental of real estate is not a passive activity if both of the following are true.

  1. More than one-half of the personal services you perform during the year in all trades or businesses are performed in real property trades or businesses in which you materially participate.
  2. You perform more than 750 hours of services during the year in real property trades or businesses in which you materially participate.

Source : Internal Revenue Service - United States Department of Treasury

Language : English

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