Joseph A. Morcos and Joann M. Morcos - Page 10

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          exclusive to the rental of vacation homes.  Section 280A(a)                 
          states the general rule disallowing deductions “with respect to             
          the use of a dwelling unit which is used by the taxpayer during             
          the taxable year as a residence.”  A taxpayer’s primary residence           
          in which he lives year round falls within this definition.  Sec.            
          280A(d).  If Congress had intended for section 280A to apply only           
          to the rental of vacation homes, they were capable of creating              
          such result.                                                                
               Moreover, the legislative history of section 280A                      
          establishes that Congress wanted to prevent taxpayers from                  
          converting nondeductible personal living expenses into deductible           
          business expenses.  S. Rept. 94-938 (1976), 1976-3 C.B. (Vol. 3)            
          49.  The underlying rationale of the statute is just as relevant            
          for taxpayers renting portions of their primary residence and               
          attempting to deduct personal living expenses as it is for                  
          taxpayers renting their vacation homes.                                     
               Petitioners next argue that the limitation of section                  
          280A(c)(5) does not apply to them “by virtue of the terms of                
          section 280A(c)(3) which excepts ‘rental of the dwelling unit or            
          portion thereof.’”  This argument is without merit.  Section                
          280A(c)(3) excepts rental use from the application of section               
          280A(a).  Respondent does not contend that petitioners are not              
          entitled to deduct any of the expenses attributable to the rental           
          of a portion of their dwelling unit pursuant to section 280A(a),            

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