- 13 -
petitioner aggregated his losses is not clear notice that he
intended to elect under section 469(c)(7).
2. Whether Reporting That Net Losses Were Active Is an
Election Under Section 469(c)(7)
Petitioner argues that he treated his net losses as active
rather than passive and that he thereby elected to treat his
rental real estate activities as one activity under section
469(c)(7). As evidence that he treated his net losses as active,
he points out that he reported on lines 22 through 26 and 42 of
Schedule E, line 1d of Form 8582, and statements in support of
Form 8582 of his 1994 return that, except for one property, none
of the properties had a passive gain or loss and that he did not
add his 1994 losses to previously suspended losses. On line 42
of Schedule E, he reported the loss of $56,954 as though he were
a real estate professional and had sustained that loss in an
activity or activities in which he materially participated.
Petitioner contends that this shows that he elected to treat his
rental real estate activities as one activity under section
469(c)(7). We disagree.
Petitioner’s reporting that his net losses were active is
not clear notice that he elected under section 469(c)(7) because
he would also have reported that his net losses were active if he
had materially participated in each of the seven rental real
estate activities and had not elected under section 469(c)(7).
See sec. 469(c) and (d); sec. 1.469-5T, Temporary Income Tax
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011