I've been managing our own properties since 2012, and I want to make sure that the many hours I spend on our 8 properties are countable for the Real Estate Professional designation. Can you help me sort out what seems to be some conflicting information from around the web, especially regarding the time I spend researching and whether those hours count? (I am familiar with the requirements for 750 hours, no outside FT employment, and spending 500 hours on each activity, or as an aggregate). I want to be sure that the following activities I am assuming I can count are, indeed, allowable.
Research: For this I would include time spent browsing listings, driving around to prospective properties, neighborhoods, viewing comps, etc--Obtaining the background knowledge someone needs to evaluate whether a potential property is a good investment.
Leasing: Advertising, communicating with prospective tenants, vetting their references, etc., visiting their current residences, time spent cross checking flagged areas on a credit/screening reports, etc.
Maintenance: Includes time spent fielding and responding to tenant requests, finding professionals to handle certain jobs, travel to the job site, time I spend performing repairs within my capabilities, time I spend cleaning a unit.
We have been advised that I should be receiving a W2 from our LLC, and that would give a clear signal to the IRS that I am a RE Prof. I am not so sure about that advice, but it is coming from an experienced realtor who assures us we should be doing it. We are currently interviewing a few different tax advisors, as we would like one who is more up to date with RE strategy and the changing laws.
