-16-
the calculation of gross income. Such an approach would
eliminate the need to review the partnership’s tax returns, and
respondent would have satisfied his burden. We have not
previously addressed whether section 6501(e)(1)(A) is applicable
only to situations in which the taxpayer-partner did materially
or actively participate in the partnership. We hold that it is
not so limited.
A general partner may be deemed to be conducting the trade
or business activity of the partnership of which she is a member.
Flood v. United States, 133 F.2d 173, 179 (1st Cir. 1943); Cokes
v. Commissioner, 91 T.C. 222, 228 (1988); Drobny v. Commissioner,
86 T.C. 1326 (1986); Brannen v. Commissioner, 78 T.C. 471 (1982),
affd. 722 F.2d 695 (11th Cir. 1984); Hagar v. Commissioner,
76 T.C. 759 (1981); Ward v. Commissioner, 20 T.C. 332 (1953),
affd. 224 F.2d 547 (9th Cir. 1955); Cluet v. Commissioner, 8 T.C.
1178, 1180 (1947); see sec. 1.702-1(b), Income Tax Regs. See
generally Rev. Rul. 92-17, 1992-1 C.B. 142. Moreover, the trade
or business of the partnership may be imputed to a general
partner, irrespective of the fact that the partner did not
actively or materially participate in the partnership. Bauschard
v. Commissioner, 31 T.C. 910 (1959), affd. 279 F.2d 115 (6th Cir.
1960). It is also possible for the trade or business activity of
a limited partnership to be imputed to a limited partner.
Newhall Unitrust v. Commissioner, 104 T.C. 236 (1995), affd.
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