Ronald P. Barranti and Stephanya M. Barranti - Page 7

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               Congress enacted section 280A as part of the Tax Reform Act            
          of 1976, Pub. L. 94-455, sec. 601, 90 Stat. 1520, 1569, as its              
          response to the concern that rental of property used as a                   
          residence by the taxpayer's family "afforded the taxpayer                   
          unwarranted opportunities to obtain deductions for expenses of a            
          personal nature."  Bolton v. Commissioner, 77 T.C. 104, 108                 
          (1981), affd. 694 F.2d 556 (9th Cir. 1982).  Under section 280A             
          no deduction can be taken by a taxpayer with respect to a                   
          dwelling unit used as a residence by a taxpayer during the                  
          taxable year except for deductions, such as interest and taxes,             
          which are allowable without regard to their connection to an                
          income producing activity or a trade or business.  Sec. 280A(a)             
          and (b).  A taxpayer is considered to have used a dwelling unit             
          as a residence during the taxable year if the unit is used for              
          personal purposes for the greater of 14 days or 10 percent of the           
          number of days for which the unit is rented at a fair rental.               
          Sec. 280A(d)(1).  If a dwelling unit is rented to a member of the           
          taxpayer's family, as defined in section 267(c)(4), for any part            
          of a day, the unit is deemed to have been used on that day by the           
          taxpayer for personal purposes unless the unit is used as the               
          principal residence of the family member and the rent charged to            
          the family member reflects a fair rental for the unit.  Sec.                
          280A(d)(2)(A), (3)(A); Kotowicz v. Commissioner, T.C. Memo. 1991-           
          563; Gilchrist v. Commissioner, T.C. Memo. 1983-288.                        





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