Real estate professional criteria

[Sarah Lawrence]

Hi,  I am very new to real estate investing. We have a had rental property for several years, but I want to take this to the next level.  We have a major repair in our rental this year and I know that we are going to exceed the limit for allowable passive losses.  I am curious of how everyone else does this.  Do you classify yourself as a real estate professional for use in the given scenario: The IRS rules for claiming Real Estate Professional Status are very clear, and require that two key criteria be met in the given tax year:

1. More than half of the professional hours worked throughout the year must have been devoted to material participation in real estate activities;
2. More than 750 hours of material participation in real estate activities in the tax year being considered.

Or do you run it as a business as and use a schedule C?  For the real estate professional status, currently I work approximately 40 hours every 2 weeks at my current job, so would I have to work at least 21 documented hours every 2 weeks to meet the first criteria?  I apologize for being so ignorant, I just want to get started right as this is year zero. Thanks in advance for any advice!

[Henri Meli]

I could be wrong here, but I think you can split the losses across multiple years (if that's an option for you).