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share of income from VBR’s trade or business activity of
operating bowling alleys under the exception in section 1.469-
4(d)(1)(A), Income Tax Regs., on the ground that the rental
activity is “insubstantial” in relationship to the business
activity of VBR. Petitioner merely makes this assertion without
citing any applicable authority and without any legal analysis.
The record lacks any evidence to support the argument that
the rental activity was insubstantial with respect to VBR’s trade
or business. Therefore, we hold that petitioner cannot group
together his rental activity and VBR’s trade or business for
purposes of the passive activity loss limitations of section 469.
For all the foregoing reasons, respondent’s determinations
in the notice of deficiency are sustained.
Reviewed and adopted as the report of the Small Tax Case
Division.
Decision will be entered
for respondent.
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Last modified: May 25, 2011