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participates in the activity, sec. 469(c)(2), (4).
For purposes of section 469(c)(1), the term "trade or busi-
ness" is defined in section 469(c)(6) to include any activity in
connection with a trade or business or any activity with respect
to which expenses are allowable as a deduction under section 212.
For purposes of section 469(c)(2), the term "rental activi-
ty" is defined in section 469(j)(8) as any activity where pay-
ments are principally for the use of tangible property. See also
sec. 1.469-1T(e)(3)(i), Temporary Income Tax Regs., 53 Fed. Reg.
5702 (Feb. 25, 1988). However, an activity involving the use of
tangible property is not a rental activity for a taxable year,
inter alia, if for such taxable year the average period of cus-
tomer use for such property is seven days or less. Sec. 1.469-
1T(e)(3)(i) and (ii)(A), Temporary Income Tax Regs., supra.
In the instant case, the parties have stipulated that the
average period of customer use of petitioner's condominiums at
Crestwood was less than seven days during each of the years at
issue. Respondent concedes on brief, and the parties thus agree,
that, consequently, petitioner's rental activity at Crestwood
during each such year is not a rental activity as defined in
section 469(j)(8) and the regulations thereunder and thus is not
a passive activity under section 469(c)(2). See sec. 1.469-
1T(e)(3)(i) and (ii)(A), Temporary Income Tax Regs., supra.
The parties do not dispute that petitioner's rental activity
at Crestwood during each year at issue constitutes an activity
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