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In the notice for 1991 and 1992, respondent disallowed
(1) for 1991 all of the claimed Schedule E expenses with respect
to the Church Street property and the Sanchez Street property and
(2) for 1992 all of the claimed Schedule E expenses with respect
to the Sanchez Street property. Respondent made that determina-
tion because, inter alia,96
it has not been established that * * * [the claimed
Schedule E expenses] were ordinary and necessary busi-
ness expenses or were expended for the purpose desig-
nated. * * * nor has it been established that you were
at risk per section 465 of the Internal Revenue Code.
* * *
As an alternative ground for disallowing the claimed Schedule E
expenses for 1991 and 1992, respondent determined that
the claimed losses are not allowable per Section 469 of
the Internal Revenue Code because you did not actively
participate in the management of the rental properties
and because you have no other passive income to offset
the passive losses.
With respect to $1,611.10 of the claimed Schedule E expenses
96An additional ground set forth by respondent in the notice
for 1991 and 1992 for disallowing all of the claimed Schedule E
expenses for those years was that petitioner and Ms. Brodsky had
not established an ownership interest in the Church Street
property and the Sanchez Street property. On the record before
us, we reject that ground. On that record, we have found that at
least during part of 1991 and 1992 until the date of the sale of
the Church Street property, petitioner owned an interest in that
property, although the extent of that interest is not disclosed
by credible evidence in the record. We have further found on the
record before us that at least during the period beginning in
1991 and ending on the date of the sale of the Sanchez Street
property in 1993, petitioner and Ms. Brodsky owned an interest in
that property, although the extent of that interest is not
disclosed by credible evidence in the record.
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