- 7 - activity” as defined above, for any rental activity is a passive activity. If petitioner establishes that the activity was not a rental activity, he then must establish that he materially participated in the activity to avoid the proscription of section 469. On this record, we find that petitioner provided equipment to production companies for an average period of 30 days or less and that he performed significant personal services in connection with making the property available for use by customers. Petitioner acquired, maintained, transported and repaired the tools and equipment. We also find that petitioner provided extraordinary personal services. The rental of the tools and equipment by the production companies is incidental to their receipt of petitioner’s services as construction coordinator. Therefore, we hold that petitioner’s activity was not a rental activity within the meaning of section 469(j)(8). A taxpayer is treated as materially participating in an activity only if the taxpayer is involved in the operations of the activity on a basis which is regular, continuous, and substantial. Sec. 469(h)(1). Petitioner’s business as construction coordinator was regular, continuous (for each project), and substantial. Therefore, we hold that petitioner materially participated in his rental activity, and thePage: Previous 1 2 3 4 5 6 7 8 9 Next
Last modified: May 25, 2011