CRSO - Page 12

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               Whether or not respondent has caught a rabbit, it would                
          appear that petitioner is in the soup.  The question is whether             
          petitioner belongs there.                                                   
               Section 502(b)(1) expressly provides that its special rule             
          as to the meaning of “trade or business” applies “For purposes of           
          this section”.  Consequently, in construing section 502, we do              
          not read subsection (a) in isolation but in conjunction with the            
          special rule of subsection (b)(1), which addresses the meaning of           
          the term “trade or business”.                                               
               Section 502(b)(1) excludes from the term “trade or business”           
          the deriving of rents that would be excluded from UBTI under                
          section 512(b)(3) if section 512 applied to the organization.               
          Under traditional principles of statutory construction, the                 
          statute’s explicit provision excluding rental activity that meets           
          this test should be understood as precluding the exclusion of               
          rental activity that does not meet this test.  See Silvers v.               
          Sony Pictures Entmt., Inc., 402 F.2d 881, 885 (9th Cir. 2005);              
          Catterall v. Commissioner, 68 T.C. 413, 421 (1977), affd. sub               
          nom. Vorbleski v. Commissioner, 589 F.2d 123 (3d Cir. 1978); see            
          also Black’s Law Dictionary 620 (8th ed. 2004) (the statutory               
          canon of construction “expressio unius est exclusio alterius”               
          holds that “to express or include one thing implies the exclusion           
          of the other, or of the alternative”).                                      

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