- 21 -
reasoning to the situation herein before us, we examine only the
actual services performed by Rainbow Reservations in support of the
Maui condo, and not services that are not directly related to
petitioners' rental. In this regard, it is evident that the time
spent checking tenants in and out, the maid services, the managing
of the rent collection and disbursements, and the other few
miscellaneous tasks performed by Rainbow Reservations for
petitioners did not exceed 200 hours during 1993, and certainly did
not exceed the time spent by petitioners. We do not believe it
appropriate to consider as participation for purposes of
determining whether petitioners qualify for the safe harbor under
section 1.469-5T(a)(3), Temporary Income Tax Regs., 53 Fed. Reg.
5702 (Feb. 25, 1988), the mere availability of the front desk
personnel.
In Serenbetz v. Commissioner, supra, the taxpayers owned a
Vermont condominium which was part of a partnership that rented out
the condominiums to third parties. The day-to-day operation of the
partnership was managed by an on-site staff of nine employees who
conducted the marketing and renting of the condominiums and
maintained the books and records. The taxpayers attempted to prove
that they spent more time than the on-site staff in operating their
rental by dividing the total number of staff hours worked by the
number of employees (9) and by the number of condominium units in
the partnership (40). We rejected the taxpayers' methodology
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011