- 8 -
be treated as materially participating in an activity for the
taxable year if and only if:
(1) The individual participates in the activity
for more than 500 hours during such year;
(2) The individual's participation in the
activity for the taxable year constitutes substantially
all of the participation in such activity of all
individuals (including individuals who are not owners
of interests in the activity) for such year;
(3) The individual participates in the activity
for more than 100 hours during the taxable year, and
such individual's participation in the activity for the
taxable year is not less than the participation in the
activity of any other individual (including individuals
who are not owners of interests in the activity) for
such year;
(4) The activity is a significant participation
activity * * * for the taxable year, and the
individual's aggregate participation in all significant
participation activities during such year exceeds 500
hours;
(5) The individual materially participated in the
activity * * * for any five taxable years (whether or
not consecutive) during the ten taxable years that
immediately precede the taxable year;
(6) The activity is a personal service activity
* * * and the individual materially participated in the
activity for any three taxable years (whether or not
consecutive) preceding the taxable year; or
(7) Based on all of the facts and circumstances
* * * the individual participates in the activity on a
regular, continuous, and substantial basis during such year.
These regulations provide for taxpayers to be treated as
materially participating in an activity if they satisfy one of
the seven enumerated tests. Petitioners argue that they satisfy
the requirements of section 1.469-5T(a)(3), Temporary Income Tax
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011