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average period of customer use is 7 days or less. Scheiner v.
Commissioner, supra.
Section 469(i)(1) and (2) provides:
(i) $25,000 Offset for Rental Real Estate
Activities.--
(1) In general.--In the case of any
natural person, subsection (a) shall not
apply to that portion of the passive activity
loss * * * which is attributable to all
rental real estate activities with respect to
which such individual actively participated
in such taxable year * * *.
(2) Dollar limitation.--The aggregate
amount to which paragraph (1) applies for any
taxable year shall not exceed $25,000.
In effect, section 469(i) allows the taxpayer to offset from
nonpassive income up to $25,000 of certain passive activity
losses.4 With respect to the limited applicability of the
$25,000 offset to losses attributable to "rental real estate
activities", the legislative history of section 469 explains:
Since relief under this rule applies only to
rental real estate activities, it does not apply to
passive real estate activities that are not treated as
rental activities under the provision (e.g., an
interest in the activity of operating a hotel). * * *
[S. Rept. 99-313 (1986), 1986-3 C.B. (Vol. 3) 1, 737.]
Congress, therefore, intended that taxpayers should be entitled
to the $25,000 offset for losses attributable to "rental real
4 The $25,000 offset allowable under sec. 469(i) is phased
out as adjusted gross income, modified by sec. 469(i)(3)(E),
exceeds $100,000, with a full phase-out occurring when modified
adjusted gross income equals $150,000. Sec. 469(i)(3)(A).
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