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Petitioner’s estimate of the hours that he spent on real
estate rental activities is as follows:
1994 1995
New York property 456.0 409.0
Apartment building 229.0 --
Commercial building 163.5 17.0
Florida property 357.0 336.5
Travel 280.0 210.0
Administrative 70.0 80.0
Total 1,555.5 1,052.5
Mrs. Fowler performed administrative services related to the
rental properties. She reviewed mail and invoices, made deposits
of rental income, prepared accounting records, prepared checks to
pay rental expenses, filed business records, maintained and
backed up computerized accounting records, compared actual
expenses with budgeted expenditures, and met with the certified
public accountant in connection with the preparation of income
tax returns. Mrs. Fowler did not keep a calendar or a log of the
hours that she spent performing these activities, but she
estimated that she spent about 600 hours a year on these
administrative tasks.
Petitioners used the services of independent contractors to
assist in the management and maintenance of the rental
properties. Petitioners hired a manager for the apartment
building. The manager was responsible for answering telephone
calls, collecting rents, and depositing the monthly checks. The
manager was paid a percentage of the money that she collected.
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