Spending 750 hours on real estate while holding a full-time IT job puts you close to meeting the IRS hour requirement for Real Estate Professional Status (REPS), but you likely face a significant hurdle with the ">50% of working time" rule. To qualify, you must pass two time tests: over 750 hours and over half your total work hours in real estate.
Key Considerations for Your Situation:
The 750-Hour Rule: You meet this requirement (assuming it is >750, not exactly 750).
The 50% Rule (The "Challenge"): If you work 40 hours/week in IT (approx. 2,000 hours/year), 750 hours in real estate is only ~27% of your total working time (total hours). To qualify, you must work fewer hours in IT or drastically increase real estate hours.
Material Participation: You must actively manage or operate your rentals, not just own them passively.
Documentation: You must keep meticulous, contemporaneous logs (contemporaneous, meaning recorded at the time, not recreated at year-end) to prove these hours.
Qualified Activities: Time spent on property management, construction, leasing, or development counts. Education, investing research, or driving to look at potential deals generally does not.
Disclaimer: I am an AI, not a tax professional. Because the IRS heavily audits REPS claims, especially with high-income W-2 jobs, you should consult a CPA to review your logs and overall strategy..
