Though real estate rental income is classified as aggregated income , the Income Tax Act treats it differently from other income . When taxpayer gets income in real estate rental activity , the income is aggregated to other income. For the progressive tax rate that the Income Tax Act adopts, aggregation means heavier tax burden than that of separated. But when taxpayer get a loss in real estate rental activity, the loss is not aggregated to other income. This rule is assumed to make an model after american tax law which adopts the passive loss limitations. The American passive loss limitation applies to rental activity and many other investment, permits losses incurred in a passive activity to be deducted only from income generated by passive activities, not from active trade or business or wages or from portfolio income. Treatments for real estate rental income in the Income Tax Act have some problems. First, there is no distinct difference between business activity and real estate rental activity . Some real estate rental activity is regarded as business activity. Second, deferred loss generated from real estate rental activity is not deducted from the capital gains when the real estate is sold. Loss incurred in ordinary rental activity should be deducted from usual income or capital income. Third, Only real estate rental activity is regarded as passive activity. It is unfair to discriminate real estate rental activity against many other activities. So it is desirable to abolish these unusual treatments for real estate rental income.