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rental real estate activity. Sec. 469(c)(7)(A); sec. 1.469-
9(e)(1), Income Tax Regs. Petitioner did not make a timely
election to treat all interests in rental real estate as a single
rental real estate activity.
Real property trades or businesses are defined in section
469(c)(7)(C) as “any real property development, redevelopment,
construction, reconstruction, acquisition, conversion, rental,
operation, management, leasing, or brokerage trade or business.”
A trade or business includes being an employee. Putoma Corp. v.
Commissioner, 66 T.C. 652, 673 (1976), affd. 601 F.2d 734 (5th
Cir. 1979).
Petitioner asserts that he devoted more than 750 hours to
real property trades or businesses because his “activities show a
meaningful involvement in real property trades or business” and
he bases this on the following: (1) He was the general
contractor on three projects in 1995 and two projects in 1996;
(2) he spent a significant amount of time looking for additional
real estate to purchase; (3) he owned 20 real estate properties
in 1995 and 21 in 1996; (4) he purchased five real estate
properties in 1995 and four in 1996; (5) he sold two parcels of
real estate in 1995; and (6) he spent over $395,870 and $597,000
in construction costs in 1995 and 1996, respectively. The number
of properties owned, sold, or purchased or the amount of money
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