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of Appeals, namely, the First, Fifth, and Seventh. See Krukowski
v. Commissioner, 279 F.3d 547 (7th Cir. 2002), affg. 114 T.C. 366
(2000); Sidell v. Commissioner, 225 F.3d 103 (1st Cir. 2000),
affg. T.C. Memo. 1999-301; Connor v. Commissioner, 218 F.3d 733
(7th Cir. 2000), affg. T.C. Memo. 1999-185; Fransen v. United
States, 191 F.3d 599 (5th Cir. 1999). According to petitioners,
all of these cases were wrongly decided for the reasons argued by
the taxpayers there. We disagree. Given the detailed and
exhaustive analysis set forth in those cases in rejection of the
arguments made by the taxpayers there, we see no need to repeat
that analysis herein. Suffice it to say that the
recharacterization rule of section 1.469-2(f)(6), Income Tax
Regs., is a legislative regulation that was properly promulgated
by the Secretary pursuant in part to the specific grant of
authority stated in section 469(l) that allows him to prescribe
all necessary or appropriate regulations to carry out the
provisions of section 469, including regulations: (1) Defining
the terms “activity” and “material participation”, sec.
469(l)(1), and (2) “requiring net income or gain from a * * *
passive activity to be treated as not from a passive activity”,
sec. 469(l)(3).
We also disagree with petitioners’ second assertion. First,
from a factual point of view, we are unable to agree with
petitioners that the instant case is distinguishable from the
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