New York Couple Improperly Took Real Estate Loss Tax Deduction

Two New Yorkers failed to convince a state administrative law judge that they spent enough time managing rental properties to qualify for an income tax deduction for their losses.

Cardinald and Paulette T. Donald provided two sets of work logs itemizing the hours they worked on their three Brooklyn rentals. The logs reported “drastically different service hours worked on the properties” making them “simply unreliable,” New York Division of Tax Appeals Administrative Law Judge Donna M. Gardiner ruled in an opinion released Friday.

The Donalds sought to deduct $16,400 for losses incurred from rental real estate activities on their 2016 ...