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situation that would satisfy section 1.469-1T(e)(3)(vi)(C)(2),
Temporary Income Tax Regs., 53 Fed. Reg. 5703 (Feb. 25, 1988).
The preamble’s general one-sentence introductory comment
concerning the regulation in question does not amount to
“unequivocal evidence of administrative intent” that use of the
property in the trade or business activity must cease before the
property is used in the rental activity. A contrary conclusion
would import into the regulation a requirement that simply is not
in the terminology of the regulation.
Third, respondent cites section 1.469-1T(e)(3)(viii),
Example (6), Temporary Income Tax Regs., 53 Fed. Reg. 5703 (Feb.
25, 1988) (hereinafter referred to as example (6)). In example
(6), a taxpayer owns an interest in a farming activity, which is
a trade or business activity, and owns farmland that is used in
the farming activity in 1985 and 1986. In 1987, 1988, and 1989,
the taxpayer does not use the land in the farming activity.
Instead, during those years he leases the land to other parties,
but continues his interest in the farming activity. The taxpayer
is permitted to treat the rental of his land as incidental to his
farming activity in 1987 and 1989 based on the gross rental
income received. Id.
Example (6) does illustrate respondent’s narrow
interpretation of section 1.469-1T(e)(3)(vi)(C), Temporary Income
Tax Regs., 53 Fed. Reg. 5703 (Feb. 25, 1988). Example (6) is the
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