Paul M. and Wanda E. Harmon - Page 3

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          other court, and this opinion shall not be treated as precedent             
          for any other case.                                                         
               Petitioners claimed deductions for a rental real estate loss           
          of $68,796 for the taxable year 2001 that respondent denied,                
          resulting in a deficiency in petitioners’ income tax for the year           
          of $18,937.  The sole issue for decision is whether petitioner-             
          wife was a real estate professional and thus not subject to the             
          passive activity loss rule of section 469(c)(2) and (4).2                   
               Some of the facts have been stipulated, and they are so                
          found.  We incorporate by reference the parties’ stipulation of             
          facts and accompanying exhibits.                                            
               At the time the petition was filed, Paul M. Harmon (Mr.                
          Harmon) and Wanda E. Harmon (petitioner or Mrs. Harmon) resided             
          in Oakland, California.3                                                    
               With a background in English and a master’s degree in                  
          counseling, petitioner was employed by both Golden Gate                     

               2  The two other adjustments contained in the notice of                
          deficiency are mechanical in nature and are dependent on the                
          final calculation of petitioners’ adjusted gross income.                    
               3  Although Mr. and Mrs. Harmon both signed the petition, as           
          only Mrs. Harmon appeared in person at trial and as this case               
          solely concerns Mrs. Harmon’s status as a real estate                       
          professional, we refer to Mrs. Harmon alone as petitioner.  We              
          refer to Mr. and Mrs. Harmon jointly as petitioners.                        

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