In recent years, the number of wind farms consisting of type 3 and type 4 wind turbines located within the distribution system has been growing rapidly. Wind turbines can be utilized as a continuous reactive power source to support the system voltage by taking advantage of their reactive power control capability. This paper aims to further develop the reactive power assignment strategy in order to minimize losses in wind farms described in the published paper. We introduce the method of reconfiguration and numbering to apply the algorithm to the wind farm structure and develop the previously-defined allocation ratio into two types of allocation ratios. The goal is to apply the loss minimization algorithm to a wind farm configuration with up to two wind turbines connected to one ring main unit (RMU). The proposed strategy reduces power loss and increases the real power flow in the wind farm by allocating reactive power to connected wind turbines taking into account the resistance value. The proposed allocation technique is validated in a Real Time Digital Simulator (RTDS)-based Hardware-in-the-loop Simulation (HILS) environment considering the Dongbok wind farm configuration in Jeju, South Korea. In the simulation, a Raspberry Pi acts as a wind farm controller sending a reactive power dispatch signal to each wind turbine via Modbus TCP/IP protocol. The simulation results mean that, applying the proposed algorithm, we can expect loss reduction effects in the wind farm.