This question is based on the following assumptions:

1. Rental real estate income is not subject to Self Employment taxes
2. Real Estate investors are subject to the new 3.8% Medicare tax
3. Non Passive income is exempt from the 3.8% tax.

Thus, assuming an investor can pass the test of being a full time real estate professional (hours worked and documented) and thus be exempt from the 3.8%, do they then have to pay SE tax? Also assume the investor owns the property through an LLC.

In other words, under these conditions can an investor avoid both taxes?