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13143(a), 107 Stat. 416, 440. The provisions of subsection
(c)(7) of section 469 are effective for taxable years beginning
after December 31, 1993. Id. sec. 13143(c), 107 Stat. 441. Two
of the taxable years before us, 1992 and 1993, precede the
effective date of the "Special rules for taxpayers in real
property business" contained in subsection (c)(7). Thus, for
those years petitioner may not rely on the special rules to
relieve him of the generally applicable strictures of section 469
denying deductions for passive activity losses.
Section 469(i), with respect to rental real estate
activities in which an individual actively participates, provides
that the section 469(a) disallowance will not apply to a maximum
of $25,000 of passive activity losses.3 There is allowed only
one $25,000 offset for all of petitioner's rental activities per
year. Sec. 469(i)(2).
For the year 1992, petitioner reported items on Schedule E.
After taking into consideration rental (passive) income,
petitioner reported individually owned real estate rental losses
of $50,779, partnership real estate rental losses of $12,125, and
3This nonapplication or "exemption" begins to be phased out
where the taxpayer's adjusted gross income exceeds a certain
level, in some circumstances $100,000. Sec. 469(i)(3).
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