William N. and Moira M. Carlstedt - Page 10

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                  In an attempt to secure long-term financing, petitioner                                
            developed numerous information packages valuing the buildings for                            
            potential lenders.  These packages also included background                                  
            information about the partnerships.  Petitioner, along with Roger                            
            Eiteljorg, contacted roughly 100 financial institutions each year                            
            on behalf of the partnerships in an attempt to find long-term                                
            financing.  Many were contacted twice.  Approximately 80 pension                             
            funds and 27 life insurance companies were also contacted in this                            
            manner.  Petitioner's efforts to refinance the partnerships                                  
            occupied much of his time, both in 1990 "and especially in '91".                             
                  Petitioner's Estimations of Time Spent on CDI Activities in                            
            1990 and 1991                                                                                
                  In mid-1990, petitioner's accountant informed him of the                               
            possibility of offsetting his share of the partnerships' passive                             
            losses against his income from CDI if petitioner were to spend                               
            less than 500 hours on CDI activities for the year.  The                                     
            accountant advised petitioner to keep a reasonable record of his                             
            time, and to review his activities for the months in 1990 that                               
            had already passed.                                                                          
                  Petitioner maintained a contemporaneous calendar of a                                  
            portion of his time and activities during the years in issue.                                
            For 1990, petitioner listed activities on his calendar related to                            
            CDI and the partnerships totaling 641 hours.  Of that amount,                                








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