NonPassive Entities include:
- Trade or business in which you materially participated for the tax year.
- A working interest in an oil or gas well which you hold directly or through an entity that does not limit your liability (such as a general partner interest in a partnership). It does not matter whether you materially participated in the activity for the tax year. However, if your liability was limited for part of the year (for example, you converted your general partner interest to a limited partner interest during the year) and you had a net loss from the oil or gas well for the year, some of your income and deductions from the working interest may be treated as passive activity gross income and passive activity deductions.
- The rental of a dwelling unit that you also used for personal purposes during the year for more than the greater of 14 days or 10% of the number of days during the year that the home was rented at a fair rental.
- An activity of trading personal property for the account of those who own interests in the activity.
- Rental real estate activities in which you materially participated as a real estate professional.
Note: please refer to the IRS publication 925 for additional information: Activities that are not passive activities