--- title: "What Activities Count Toward the 750-Hour REPS Test (and What Doesn't) | Addicted to ROI" description: "The IRS list of qualifying real estate activities for the 750-hour Real Estate Professional Status test, plus the four things investors assume count but don't." lang: en json-ld: | [ { "@context": "https://schema.org", "@type": "Organization", "@id": "https://addictedtoroi.com/#organization", "name": "Addicted to ROI", "url": "https://addictedtoroi.com", "logo": { "@type": "ImageObject", "url": "https://addictedtoroi.com/images/logo.png" }, "description": "Live your best life funded by your investments. Real estate, taxes, travel, and business, by Jennifer Beadles.", "founder": { "@id": "https://addictedtoroi.com/#jennifer" }, "sameAs": [ "https://agentsinvest.com", "https://doorprofit.com", "https://repstime.com", "https://strhours.com", "https://kidspayroll.com", "https://rentstager.com" ] }, { "@context": "https://schema.org", "@type": "WebSite", "@id": "https://addictedtoroi.com/#website", "url": "https://addictedtoroi.com", "name": "Addicted to ROI", "publisher": { "@id": "https://addictedtoroi.com/#organization" }, "potentialAction": { "@type": "SearchAction", "target": { "@type": "EntryPoint", "urlTemplate": "https://addictedtoroi.com/blog/?q={search_term_string}" }, "query-input": "required name=search_term_string" } }, { "@context": "https://schema.org", "@type": "Person", "@id": "https://addictedtoroi.com/#jennifer", "name": "Jennifer Beadles", "url": "https://addictedtoroi.com/about/", "jobTitle": "Founder, Addicted to ROI", "description": "Real estate investor and founder of Addicted to ROI. Built an 8-figure rental portfolio across multiple states and teaches everyday investors how to build passive income.", "worksFor": { "@id": "https://addictedtoroi.com/#organization" }, "sameAs": [ "https://agentsinvest.com", "https://doorprofit.com", "https://repstime.com", "https://strhours.com", "https://kidspayroll.com", "https://rentstager.com" ] }, { "@context": "https://schema.org", "@type": "Article", "mainEntityOfPage": { "@type": "WebPage", "@id": "https://addictedtoroi.com/blog/reps-activities/" }, "headline": "What Activities Count Toward the 750-Hour REPS Test (and What Doesn't)", "description": "The IRS list of qualifying real estate activities for the 750-hour Real Estate Professional Status test, plus the four things investors assume count but don't.", "image": "https://images.unsplash.com/photo-1554224155-6726b3ff858f?w=800&q=80", "datePublished": "2026-07-09", "dateModified": "2026-07-09", "author": { "@id": "https://addictedtoroi.com/#jennifer" }, "publisher": { "@id": "https://addictedtoroi.com/#organization" }, "speakable": { "@type": "SpeakableSpecification", "cssSelector": [ ".tldr-answer", "h1" ] } }, { "@context": "https://schema.org", "@type": "BreadcrumbList", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://addictedtoroi.com" }, { "@type": "ListItem", "position": 2, "name": "Blog", "item": "https://addictedtoroi.com/blog" }, { "@type": "ListItem", "position": 3, "name": "Tax Strategies", "item": "https://addictedtoroi.com/blog?category=tax-strategies" }, { "@type": "ListItem", "position": 4, "name": "What Activities Count Toward the 750-Hour REPS Test (and What Doesn't)", "item": "https://addictedtoroi.com/blog/reps-activities/" } ] }, { "@context": "https://schema.org", "@type": "FAQPage", "mainEntity": [ { "@type": "Question", "name": "What activities count toward the 750-hour real estate professional test?", "acceptedAnswer": { "@type": "Answer", "text": "Development, redevelopment, construction, reconstruction, acquisition, conversion, rental operations, management, leasing, and brokerage. In practice that is listing, showing, inspecting, improving, managing tenants, handling evictions, and running the property. Employee hours count only if you own more than 5% of the business." } }, { "@type": "Question", "name": "Does studying real estate or attending conferences count toward REPS hours?", "acceptedAnswer": { "@type": "Answer", "text": "No. Education and study are treated as investor activity, not operating a real estate business, so they do not count toward the 750 hours." } }, { "@type": "Question", "name": "Do mortgage broker hours count toward real estate professional status?", "acceptedAnswer": { "@type": "Answer", "text": "No. The IRS specifically excludes mortgage brokering because it is treated as a lending business rather than a real property trade or business." } }, { "@type": "Question", "name": "What is investor capacity and why does it disqualify hours?", "acceptedAnswer": { "@type": "Answer", "text": "Investor-capacity work is monitoring your investment, like reviewing financials or analyzing performance, rather than managing the business. The IRS counts operating hours, not oversight hours, so investor-capacity time does not qualify toward the 750-hour test." } } ] } ] --- [![Addicted to ROI](/images/logo.png)](/) [Travel](/pillars/travel/)[Real Estate](/pillars/real-estate/)[Tax Savings](/pillars/tax-savings/)[Business](/pillars/business/)[Paths](/paths/)[Blog](/blog/)[Tools](/tools/)[Apps](/software/)[About](/about/) [Login](https://members.addictedtoroi.com/) Subscribe [Travel](/pillars/travel/)[Real Estate](/pillars/real-estate/)[Tax Savings](/pillars/tax-savings/)[Business](/pillars/business/)[Paths](/paths/)[Blog](/blog/)[Tools](/tools/)[Apps](/software/)[About](/about/)[Login](https://members.addictedtoroi.com/) Contents 1. [01 Activities that count ](#activities-that-count) 2. [02 Activities that don't count (even though everyone assumes they do) ](#activities-that-dont-count-even-though-everyone-assumes-they-do) 3. [03 Why this matters before you log a single hour ](#why-this-matters-before-you-log-a-single-hour) [Home](/)/ [Blog](/blog/)/ [Tax Savings](/pillars/tax-savings/) Tax Strategies # What Activities Count Toward the 750-Hour REPS Test (and What Doesn't) The IRS list of qualifying real estate activities for the 750-hour Real Estate Professional Status test, plus the four things investors assume count but don't. July 9, 2026 6 min read Contents 1. [01\. Activities that count](#activities-that-count) 2. [02\. Activities that don't count (even though everyone assumes they do)](#activities-that-dont-count-even-though-everyone-assumes-they-do) 3. [03\. Why this matters before you log a single hour](#why-this-matters-before-you-log-a-single-hour) tl;dr The 750-hour REPS test only counts hours spent operating a real property trade or business, like development, construction, acquisition, rental management, and brokerage. It does not count mortgage brokering, studying, conferences, or anything done in an investor capacity, like reviewing financial summaries. Knowing the difference before you log a single hour is what keeps your 750-hour claim from falling apart. Real Estate Professional Status is the tax designation that lets you use rental losses to offset your other income without the passive activity limits. To claim it you have to clear a 750-hour test: 750 hours or more in real property trades or businesses during the year. But the test only counts specific activities, and most investors lose hours by logging the wrong ones. This is the foundation everything else about [REPS](/blog/reps-and-year-end-tax-moves/) builds on, so start here. A ground rule before the list: REPS is IRC Section 469(c)(7), and the activities that qualify are the real property "trades or businesses" spelled out in the statute. The distinction the IRS cares about is whether you were operating a real estate business or just behaving like an investor. Those are two different things, and the second one does not count. ## Activities that count These are the hours that build toward your 750: - Development and redevelopment - Construction and reconstruction - Acquisition and conversion - Rental operations, management, and leasing - Brokerage (working as a real estate agent) On the ground, that means the real work of owning and running property: listing a property, showing it, running inspections, making improvements, handling evictions, managing tenants, and the day-to-day operation of the activity. If it is the labor of running a real estate business, it generally counts. One that surprises people: services as an employee can count, but only if you own more than 5% of the business. If you are a W-2 employee at a big real estate company and you own 6% or more of it, that time can potentially count toward your 750 hours. Own less than 5%, and employee hours are off the table. ## Activities that don't count (even though everyone assumes they do) Here is where investors quietly disqualify themselves. Mortgage brokering. The IRS specifically carves this out. Lending money is treated as a financial business, not a real estate trade or business, so mortgage broker hours do not count toward the 750. Anything done in an "investor capacity." This is the confusing one. Investor-capacity work is activity you do to monitor your investment rather than operate the business. Compiling or reviewing summaries and analyses of the property's financials, studying how the activity is performing, monitoring finances in a non-managerial role: all of that is investor-capacity work, and none of it counts. Studying and education. Reading books, taking courses, going to conferences to learn: that is investing in yourself, not operating real estate. It does not count toward 750 hours. Reviewing financial statements in that same non-managerial, monitoring sense. The pattern is worth internalizing. Doing the work of the business counts. Watching over your money counts as investor capacity, and investor capacity does not qualify. If you are not sure which side of the line an activity falls on, that is exactly the question to bring to your tax professional, because the classification is what decides whether you qualify. ## Why this matters before you log a single hour If you spend the year logging hours that don't qualify, you can hit 750 on paper and still fail the test. Knowing the categories up front changes how you spend your time and what you write down. Track the qualifying activities deliberately, in a tool built for it, so that when you add up the year the hours actually count. That is [how to track REPS hours the right way](/blog/track-reps-hours/), and it is the difference between a defensible claim and a disallowed one. This is educational, not tax advice. The activity classifications have real gray areas, and your specific facts decide the answer, so confirm how these apply to you with your CPA. If you want a clean, timestamped record of the hours that do count, [REPS Time](https://repstime.com) is built for exactly this test. Addicted to ROI is education and community, not financial or tax advice. Talk to a qualified professional before making investment or tax decisions. ![Jennifer Beadles](/images/founders.jpg) Jennifer Beadles Real estate entrepreneur with 17 years of hands-on investing experience. Built an 8-figure rental portfolio across multiple states and has helped thousands of investors build passive income through the Addicted to ROI community. The tool that goes with this ## The software that does this for you [ Hour tracking REPS Time Log your real estate hours as you go and build the contemporaneous, audit-ready record the IRS expects for REPS, instead of reconstructing it in a panic at tax time. Start logging hours ↗ ](https://repstime.com)[ STR test STR Loophole Track the 100-hour and material-participation tests for each short-term rental so the loophole that offsets your active income actually survives an audit. Track my STR hours ↗ ](https://strhours.com) Before you close the tab ## Get the next one in your inbox. One email per new article, the day it goes up. No wall, no spam, unsubscribe in a click. [Subscribe, free →](/newsletter/)[Run a deal in the calculator](/tools/deal-analysis-calculator/) Read next [ ![The Roth IRA Is the Most Wasted Account in Real Estate](https://images.unsplash.com/photo-1554224155-8d04cb21cd6c?w=800&q=80) Tax Strategies ### The Roth IRA Is the Most Wasted Account in Real Estate 10 min read → ](/blog/self-directed-roth-ira-real-estate-investors/)[ ![How to Avoid Depreciation Recapture When You Sell a Rental Property](https://images.unsplash.com/photo-1554224155-6726b3ff858f?crop=entropy&cs=tinysrgb&fit=max&fm=jpg&ixid=M3w5MjA2ODF8MHwxfHNlYXJjaHwxfHxob3VzZSUyMGZvciUyMHNhbGUlMjBzaWduJTIweWFyZHxlbnwwfDB8fHwxNzgyOTIzODcyfDA&ixlib=rb-4.1.0&q=80&w=1080) Tax Strategies ### How to Avoid Depreciation Recapture When You Sell a Rental Property 12 min read → ](/blog/how-to-avoid-depreciation-recapture-when-you-sell/)[ ![Beyond the Basic 1031: Reverse Exchanges, DSTs, and the BRRRR-to-Exchange Playbook](https://images.unsplash.com/photo-1560184897-ae75f418493e?w=800&q=80) Tax Strategies ### Beyond the Basic 1031: Reverse Exchanges, DSTs, and the BRRRR-to-Exchange Playbook 11 min read → ](/blog/advanced-1031-exchange-strategies/) If you like this ## Read these next Hand-picked to go deeper on tax savings. 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