For doctors and high-income professionals diving into real estate investing, achieving Real Estate Professional Status (REPS) is one of the only ways to significantly lower your income taxes and in some cases, completely eliminate it (like we did for 7 years in a row).

However, claiming this benefit requires you to carefully navigate the complexities of qualifying for this status. A big part of this complexity involves meticulous tracking of hours spent on real estate activities. Why? Because qualifying for REPS is all about the hours.  

[Disclaimer: We are not accountants, lawyers, or financial advisors, so please consult your own team of professionals about the topics covered in this article.]

REPS Hour Requirements: What You Need to Qualify

As one of our CPAs once told us, qualifying for REPS is a “bright line rule” based on hours. We have a detailed explanation of these rules in another article, but in brief, in order to qualify for REPS, you must spend at least 750 hours on real estate activities, and these activities must constitute more than half of the total professional hours worked within the year. There is another rule hidden in these requirements, also hours based, called material participation. 

What Activities Count as REPS Hours?

One of the most common questions we get from students of our Zero to Freedom course is, “does [type of activity] count as REPS hours?” For example, many ask, does the time I spend on the course count as REPS hours? What about driving time to and from my rental? What about the time I spend on bookkeeping for my rentals?

As far as we know, the IRS has never published guidelines specifying activities that count as REPS hours. However, we do know from reviewing past legal cases that some hours are more likely to be counted as REPS hours, while others are likely to be denied.

Hours That Are More Likely to Count

For example, the time spent actively engaged in your properties is more likely to be counted as REPS hours. This includes time spent leasing your property, managing the day-to-day operations, overseeing renovations, and any other tasks directly related to your real estate investments. This can include phone calls, meetings with agents or contractors or responding to tenant repair requests.

It’s crucial to document the nature of each activity meticulously, as this detail can be pivotal in the event of an audit.

Hours That Are Less Clear-Cut (But Still Worth Tracking)

What about the other hours that aren’t specific to a property you own and manage? Like those hours spent on coursework? We have consulted many CPAs on this topic and all of them tell us the same thing: track all of the hours you spend on real estate and let the IRS determine what counts and what doesn’t count in the unlikely event that you’re audited.

How to Track REPS Hours: Tools and Methods

There are several methods available for tracking hours, ranging from traditional pen and paper to software applications designed for time management. The software tools can range from simple spreadsheets or dedicated time-tracking apps.

Using a Calendar App to Track REPS Hours

We personally like to track hours using a calendar app like Google Calendar. Since I have a virtual assistant, many of my appointments are already in the calendar. I also ask any vendors I work with to send me calendar invites. This helps me avoid having to double enter something that has already been entered by someone else.

Other Tracking Methods: Spreadsheets and Time-Tracking Apps

I then get in the habit of planning out my calendar with not only appointments but also specific tasks that I need to do that day.  Regardless of the method chosen, the key is to stay consistent with one method or tool rather than switching from pen and paper one day to a software tool another day.

The Most Important Rule for REPS Hour Tracking: Contemporaneous Records

The IRS values contemporaneous records, meaning that hours should be logged as they occur rather than being reconstructed retroactively. This approach lends credibility to your records and can significantly bolster your case if your REPS claim is ever challenged.

Making it a habit to record your activities daily or weekly can ensure that your tracking is both contemporaneous and comprehensive. One of the best ways to do this is, schedule time in your calendar to log your hours.

Do You Submit REPS Hour Logs to the IRS Every Year?

It’s important to note that the detailed hour logs you’ve compiled so meticulously are not submitted annually to the IRS and are only required in the event of an audit. So be sure to save it in a safe place because you’ll need to produce these records to substantiate your claim effectively. 

Why Tracking REPS Hours Accurately Is Non-Negotiable

Beyond the mechanics of tracking hours, it’s essential to understand the broader implications of qualifying for REPS. Achieving this status allows you to deduct all of your real estate losses against other forms of income, which is a huge tax advantage for high earners.

However, it also underscores the need to take it seriously. The IRS isn’t handing you this tax advantage for nothing. You have to take it seriously! If you want to learn more about how to legally qualify for REPS, CLICK HERE.

Bottom line thoughts

For doctors and high-income professionals exploring real estate as a pathway to financial independence, the benefits of qualifying for REPS are clear. However, these benefits come with the responsibility of rigorous time tracking and record-keeping.

As outlined in the article, you’ll want to carefully track ALL hours you spend on real estate, whether you think it will count or not. Also, stay consistent with the method/tool that you use to track, and provide as much detail as possible. At the end of the day, if you’re serious about REPS and you’re acting like a real estate professional, not a real estate amateur, then you should have no problem justifying your REPS hours. 

Frequently Asked Questions

How many hours do you need to qualify for Real Estate Professional Status?

To qualify for REPS, you must spend at least 750 hours per year on real estate activities, and those hours must represent more than 50% of your total professional working hours for the year. You must also meet material participation requirements for each rental property.

What activities count as REPS hours?

The IRS has not published a definitive list, but hours most likely to count include time spent leasing properties, managing day-to-day operations, overseeing renovations, meeting with contractors or agents, and responding to tenant requests. Activities like coursework, driving to properties, and bookkeeping are less certain — the general recommendation is to track all real estate hours and let the IRS determine what qualifies if audited.

How should I track my REPS hours?

The IRS requires contemporaneous records, meaning hours should be logged as they happen — not reconstructed after the fact. Common methods include Google Calendar (logging appointments and tasks as they occur), spreadsheets, or dedicated time-tracking apps. The most important thing is consistency: pick one method and stick with it all year.

What does “contemporaneous” mean for REPS tracking?

Contemporaneous means recording your hours in real time, as the activity happens, rather than trying to recreate them weeks or months later. The IRS gives significantly more weight to contemporaneous records in an audit. Scheduling a weekly calendar block to log your hours is one of the best ways to stay current.

Do you have to submit REPS hour logs to the IRS every year?

No. Your REPS hour logs are not filed with your tax return and are not submitted annually. They are only required if you are audited. However, you must keep them in a safe place — if the IRS ever challenges your REPS claim, you’ll need to produce detailed records to substantiate it.