Sch E Rental losses carried fwd

[Possi]

My resident alien turned his home into rental property a few years ago and his income is around $250k. His losses have been carrying forward and they are now around $95k. He knows it isn't helping his tax picture at all. He has no deductions and owes $20k.

I'll do the estimated payments, but he probably won't pay them. He says he knows the rental isn't helping him right now but when he sells it, the carryforward losses will increase his basis.

I guess I'm just freaking out at the figures as they blow up year after year.


I feel like there should be more I could do to make his tax picture better, but it's a straight-up income, rental, no Sch A.

I'm just sayin'........

[Burke]

He says he knows the rental isn't helping him right now but when he sells it, the carryforward losses will increase his basis.........

He's right and if he's content with that, so be it. You can't make it better, just commiserate.

[Possi]

Moving back in

I guess he is tired of paying taxes, so he will be moving back into the house this year.

When this happens, I stop the Sch E, but no losses will ever be realized unless and until he SELLS the property. Isn't that right?

[Burke]

Yup............