![\"Real](\"http:\/\/cpamorey.com\/blog\/wp-content\/uploads\/2015\/07\/Real-Estate-Professional.png\")
<\/a>The IRS typically uses this first factor to exclude taxpayers with non-real-property-related full-time occupations. An examiner assumes that 40- or 50-hour-a-week wage earners would have to spend more than an additional 40- or 50-plus hours a week in a real property trade or business. Even if the taxpayer does not work full time in an unrelated occupation, an unrelated part-time occupation can still make it difficult for him or her to meet the 50% requirement.<\/p>\nMore Than 750 Hours Spent in a Real Property Trade or Business<\/strong> In practical application, however, the IRS regularly dismisses a narrative summary as self-serving and is more apt to accept a contemporaneously created log that is cross-referenced to objective substantiation.\u00a0 A good example of an acceptable log is one that references, for example, \u201cmeetings with the plumber,\u201d and the hours indicated are cross-referenced to a calendar entry, an invoice from the plumber with that date, and telephone records of calls made to the plumber\u2019s number.<\/p>\n Morey and Associates<\/strong> is an Orange County CPA Firm<\/a> with offices in Newport Beach<\/a> and San Clemente<\/a>.\u00a0 We service all types of small and medium sized businesses.\u00a0 To better service real estate businesses in Orange County, we have a specialty in real estate accounting<\/a> providing tax compliance<\/a>, outsourced CFO<\/a>, and financial reporting<\/a> services.\u00a0 Our real estate clients include real estate investment trusts<\/a>, property management companies<\/a>, investor groups, and real estate agents and developers<\/a>.<\/p>\n If you are searching for a CPA Firm with expertise in real estate accounting<\/em>, call 949-759-5626<\/strong> and ask for Jerry Morey<\/strong>.\u00a0 Our initial consultation is free.<\/p>\n","protected":false},"excerpt":{"rendered":" It is exceedingly difficult for taxpayers to prove to the IRS\u2019s satisfaction that they meet the real estate professional threshold if they are otherwise employed in an unrelated occupation. The IRS typically uses this first factor to exclude taxpayers with non-real-property-related full-time occupations. An examiner assumes that 40- or 50-hour-a-week wage earners would have to […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[],"tags":[],"_links":{"self":[{"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/posts\/95"}],"collection":[{"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/comments?post=95"}],"version-history":[{"count":1,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/posts\/95\/revisions"}],"predecessor-version":[{"id":97,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/posts\/95\/revisions\/97"}],"wp:attachment":[{"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/media?parent=95"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/categories?post=95"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cpamorey.com\/blog\/wp-json\/wp\/v2\/tags?post=95"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nThe second requirement of proving more than 750 hours were spent in the tax year materially participating in real property trades or businesses likewise presents a substantial issue of proof. In DeGuzman, 147 F. Supp. 2d 274 (D.N.J. 2001), the taxpayer husband failed to meet the 750-hour requirement when a portion of the hours were spent cleaning, shoveling snow, and maintaining his wife\u2019s leased office space, because he was basically just being a nice husband rather than participating in a trade or business. Hours spent on call, available to attend to rentals should the need arise, do not count toward the 750-hour requirement (see Moss, 135 T.C. 365 (2010)).<\/p>\n