Meeting the 100-hour material participation rule qualifies your STR income as active as long as no one else participates more than you, This will allow losses to offset W-2 or other active income.While there’s no official IRS form to track hours, maintaining a detailed log is essential in case of an audit.

However, full site visits, though more expensive, maximize tax savings by capturing every depreciable asset and offer better audit protection.While online studies may be suitable for simpler properties, full site visits are ideal for complex or high-value properties.

These include drafting offering documents, adhering to ongoing disclosure rules, and audits, which can easily run tens or hundreds of thousands of dollars.

Which is very complex and costly and likely warrants professional help.Now, if it's just you and your spouse, then your 2024 tax preparation is likely relatively straightforward:- you will create a Schedule C on your personal tax return- you will NOT report any costs of purchasing the property or its rehab, not in 2024- you will report your business overhead expenses such as marketing, driving, technology etc- you will end up with a business schedule showing zero income and some expenses - not breaking the rules but potentially raising an audit flagCan you do it yourself?

Hospitality, attention to detail, cleaning/handyman team, programs used for bookings and calendar organization, inventory audits, home maintenance, etc. are all extremely important but all of that doesn't even begin to describe all of the things an experienced property manager does.It is a matter of how much time and energy you have to invest in your properties and if that time and energy is worth it to you.

- Loss of historical data (for both IRS audits and for personal portfolio tracking.)You should be able to print the general ledger and Balance sheet / income statement for each period.

What I can say is that many physician + spouse combos have successfully done this and survived audits. 

Thought about if I did scale to say 100-200 doors that I would hire another company to audit the current PM on how they're handling my properties. 

Here is the email received"An internal audit has been completed for STR permits and our records indicate that your STR permit was issued in error due to exceeding the maximum 12.5% blockface density.

After doing an audit on my time and realizing that I spent over 40% of my time shopping for materials, I knew I needed to find a better solution.