Essentials of Federal Income Taxation 11. Material vs. Active Participation. (Obj. 3) For each of the following independent situationts, discuss whether (A) the taxpayer materially participates in the activity or (B) the activity is for active participation would apply. a. The taxpayer works 900 hours in a nonrental real estate activity and 1,000 hours as an employee (not involving rental real estate). b. The taxpayer works 650 hours in a rental real estate activity and 500 hours as an employce (not involving rental real estate). c. The taxpayer works in an activity (not involving rental real estate) 150 hours during the year. The taxpayer is retired, so this is the only activity he works for during the year. d. Both