How Many Hours Do You Really Need to Qualify for REPS?

Real Estate Professional Status (REPS) is one of the most powerful tax strategies available to real estate investors. But if you’ve tried to understand how many hours you actually need to qualify—and what counts toward that threshold—you’ve probably run into a mess of IRS jargon, conflicting advice, and confusing rules.

Let’s cut through that. If you’re actively involved in your rentals, especially if you’re self-managing, working part-time, unemployed, or in the real estate industry full-time, this guide is for you.

The Real REPS Requirement

To qualify for REPS, the IRS requires that you:

Spend more than 750 hours on real property trades or businesses during the tax year, and
Spend more time on real estate activities than any other job or business you have that year.

Here’s the important part: you must meet both of these requirements individually.

Who Can Realistically Qualify?

Let’s be honest—if you’re working a full-time W-2 job, qualifying for REPS is very unlikely. You’re probably logging 2,000+ hours at your day job, which means you’d need to spend even more time on real estate to meet the “more time than any other job” rule.

And yes, the IRS knows this. W-2 earners who claim REPS are far more likely to be audited. The math just doesn’t add up unless you cut back your hours or quit your job entirely.

REPS is much more realistic for people who:

Are unemployed or work part-time
Are self-employed or freelance
Spend all their working time actively managing rental properties
Work full-time in a real estate trade or business (e.g., agent, property manager, developer)

What Counts Toward the 750 Hours?

Pretty much any work you do related to your rental properties—or those you’re actively acquiring—can count. The key is that you must materially participate in the activity.

Activities that typically count:

Messaging guests or tenants
Scheduling and coordinating cleanings, repairs, or maintenance
Shopping for supplies or setting up a new rental
Handling insurance, leases, contracts, and vendor calls
Supervising contractors or handling project oversight
Overseeing inspections, walk-throughs, and due diligence during acquisitions

What doesn’t count:

Listening to podcasts, reading books, or attending real estate events
Market research unless tied directly to an active acquisition
Helping someone else manage their property (unless you materially participate)
Any activity where you’re a passive investor with no hands-on role

If you’re doing the work, and it’s tied to a property you own or are actively acquiring, it likely counts.

Real Estate Professionals: A Special Case

If your primary occupation is in a real property trade or business, you’re already halfway there. The IRS specifically recognizes:

Real estate agents or brokers
Property managers
Developers
Builders or contractors
Leasing agents
Construction managers
Real estate acquisition professionals

As long as you spend 750+ hours across your real property activities, you can qualify for REPS. Then for your rental properties, you just need to meet the material participation test:

You spent 500+ hours working on the rentals, or
You spent 100+ hours, and no one else did more than you, or
You did substantially all of the work yourself

Can You Combine Hours With a Spouse?

Only for material participation—not for REPS qualification itself.

REPS must be earned by one person alone. That means one spouse has to meet the 750-hour and “more time than any other job” requirements by themselves.

Once that’s done, both spouses can work together to prove material participation in their rental activity. And no, it doesn’t have to be 50/50. One spouse can log 499 hours and the other just 1—what matters is that together, you can show joint, hands-on involvement.

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Do You Need 750 Hours Per Property?

Thankfully, no. But by default, the IRS treats each rental as a separate activity.

Unless you file a grouping election with your tax return, you’ll need to prove material participation on each property. That’s why most REPS-qualified investors group their rentals into one activity. Once grouped, all your time across those rentals gets counted together, and you only need to meet the participation threshold once.

This is a simple checkbox your CPA can take care of—don’t skip it.

Common Mistake: 500 Hours Material Participation and 250 Non-Material Hours

One mistake I see all the time: someone puts in 500 hours working on their rentals (which counts), then logs another 250 hours doing other real estate tasks—like analyzing deals that go nowhere or helping a friend with their flip—and assumes they’ve hit 750 total.

But the IRS doesn’t work like that.

You must be materially participating in each activity you’re counting toward your 750 hours. If 250 of those hours were spent on a real estate business where you weren’t materially involved, they don’t count. And now you’re 250 hours short.

Moral of the story: know what you did, where, and for whom—and whether you were materially involved. Otherwise, you could lose the entire REPS claim in an audit.

Not All Hours Will Count — Aim Higher

Even if you think you hit 750 hours, some of those hours might not make the cut. Education, passive investor time, or vague “thinking about real estate” logs might be disqualified.

To stay safe, aim for 850–1,000 hours. Build in a buffer.

How REPSLog Makes It Way Easier

Trying to remember what you did three months ago and recreate it in a spreadsheet is a nightmare—especially if you’re audited.

That’s why I use REPSLog. It’s built specifically for real estate investors trying to qualify for REPS or the STR loophole.

With REPSLog, you can:

Log 5x faster using speech-to-text and AI Autofill
Set a custom goal (750, 500, or 100 hours) and track your progress
Assign hours to yourself and your spouse individually
Tag each entry with a specific property and category
Upload receipts, emails, photos, or documents for each log
Export a clean, time-stamped report if you ever need proof

Whether you’re trying to hit REPS or just track material participation, REPSLog takes the guesswork and stress out of it.

Log your Material Participation faster with AI assistance. REPSLog

Final Thoughts

REPS can unlock serious tax savings—but only if you qualify the right way. It’s not about checking a box. It’s about showing that you actually did the work, and having clean, time-stamped records to prove it.

If you’re unemployed, part-time, full-time in real estate, or spending most of your working time managing your rentals, REPS might be within reach. But if you’re working a full-time W-2? It’s probably not realistic, and the STR loophole may be a better option.

Either way—track everything. Because “I think I hit 750 hours” isn’t going to cut it.

And if you’re tracking with REPSLog, you won’t have to guess.

Please Note: REPSLog is NOT a lawyer or CPA, and this is not legal or financial advice. Please consult a qualified professional for guidance regarding IRS rules and regulations.