- 9 - Court has addressed the extraordinary personal services exception with facts similar to ours. Two cases involved equipment leasing activities that are distinguishable from the facts here. Kessler v. Commissioner, T.C. Memo. 2003-185; Hairston v. Commissioner, T.C. Memo. 2000-386. Neither case is dispositive. Both cases concerned equipment leasing activities, while we are addressing real property leasing activities in conjunction with legal support services. Moreover, the taxpayers in both Hairston and Kessler personally owned the equipment they leased to their wholly owned companies, which in turn leased the equipment to third-party end users. In each case, the lease provided that the taxpayers’ company would perform equipment maintenance. The taxpayers therefore performed maintenance services not in their role as owners of the equipment but rather in their role as corporate officers or employees. The Court consequently found that the services performed were unrelated to the taxpayers’ leasing activities. Kessler v. Commissioner, supra; Hairston v. Commissioner, supra. Here, AGI owned the real property that it leased to tenants, not petitioners, and AGI provided the services. AGI was therefore the lessor and service provider. Moreover, the services provided in Hairston and Kessler were minimal in comparison with the legal support services AGI provided to its attorney-tenants. While the services in HairstonPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011