Material participation requires that an individual participates in an activity for more than 200 hours per year or spends more than 50 hours a year in the activity and the time spent is more than anyone else spends on the activity.

Question

Quizplus · Accepted Answer

Material participation requires that an individual participates in an activity for more than 500 hours per year, or their participation constitutes substantially all the participation in such activity, among other criteria. The specific thresholds mentioned (200 hours or more than 50 hours and more than anyone else) are not accurate representations of the IRS rules for material participation.

Material Participation Requires That an Individual Participates in an Activity