Why Does the IRS Deny Real Estate Losses as "Passive"/What is a "Real Estate Professional" under Tax Law?

A rental activity is generally treated as a per se passive activity. Generally, “[r]ental real estate is any real property used by customers or held for use by customers… .” Temp. Regs. § 1.469-1T(e)(3(ii)(A); Regs. §1.469-1T(e)(3). One exception to the rule that such activities are passive is found in IRC § 469(c)(7), which was added to the tax code in 1993. Before 1993, real estate rentals were passive without exception. Under Section 469(c)(7)(B), taxpayers do not fall under the general per se rule and are able to […]

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California, Supreme Court of the State of California
United States Southern District Court of California
United States Central District Court of California
United States Bankruptcy Court Central District of California
United States Court of Federal Claims
States Tax Court
United States Court of Appeals for the Ninth Circuit
United States Court of Appeals for the Federal Circuit

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Los Angeles County Bar Association, Tax Section
Orange County Bar Association, Tax Section
Newport Harbor Bar Association
San Diego County Bar Association, Tax Section
State Bar of California, Tax Section
American Bar Association, Tax Section
Association of Tax Counsel

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Rating of 10.0 on Avvo.com, the highest rating possible (Avvo is an independent lawyer ranking system)
Current, Vice-Chair, California Tax Procedure & Litigation Committee, State Bar of California, Tax Section
Current Secretary, Orange County Bar, Taxation Section
Second Vice-Chair, California Tax Procedure & Litigation Committee, State Bar of California, Tax Section, 2012-13
Editor-in-Chief, California Tax Network, 2012-13
Current Sacramento Delegate, State Bar of California, Taxation Section, May 2013
Washington DC Delegate, State Bar of California, Taxation Section, 2012
Washington DC Delegate, State Bar of California, Tax Section, 2011
Past Chair, San Diego County Bar, Tax Section, 2007-2008
Past Chair, Tax Section, State Bar of California, Tax Section, Young Tax Lawyers, San Diego Chapter, 2003-2007
Applause Award, Deloitte & Touche LLP, October 2005 (assisted in obtaining a $26 million dollar reduction from the State Board of Equalization that generated over $550,000 in tax savings for a new client)
Domino Award, Deloitte & Touche LLP, October 2005 (leadership and advanced team planning and management)
Domino Award, Deloitte & Touche LLP, September 2005 (leadership and advanced team planning and management)
Outstanding Service Award, Legal Aid Society of San Diego, May 2005 (contribution to the Legal Aid Society’s Low Income Tax Clinic)
Wiley W. Manual Pro Bono Services Award, State Bar of California, May 2005 (contribution of pro bono services to San Diego residents)
Applause Award, Deloitte & Touche LLP, November 2004, (outstanding leadership and client development)
Outstanding Service Award, Legal Aid Society of San Diego, May 2004 (contribution to the Legal Aid Society’s Low Income Tax Clinic)
Wiley W. Manual Pro Bono Services Award, State Bar of California, May 2004 (contribution of pro bono services to San Diego residents)
AMJUR Award- Tax Valuation, Judge David Laro, US Tax Court 2003

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United States v. Campbell, 2010 U.S. Dist. LEXIS 114734 (C.D. Cal. Sep. 3, 2010) (U.S. District Court suit to reduce tax assessments to judgment and foreclose federal tax liens on real property)
Aller v. United States of America, 2010 U.S. Dist. LEXIS 46948 (C.D. Cal. Feb. 17, 2010) (U.S. District Court refund suit to reduce trust fund recovery penalty assessments to judgment)
United States v. Cornejo, 2009 U.S. Dist. LEXIS 119466 (C.D. Cal. Nov. 20, 2009) (U.S. District Court suit to enjoin tax return preparer)
Mueller v. United States Corp., 2009 U.S. Dist. LEXIS 31481 (C.D. Cal. April 10, 2009) (U.S. District Court suit for alleged misconduct against the IRS and its employee)
United States v. Zurn, 2009 U.S. Dist. LEXIS 27920 (C.D. Cal. Jan. 29, 2009) affirmed U.S. Court of Appeals, Ninth Circuit 2011-1 U.S.T.C. 50,396 (May 10, 2011) (U.S. District Court suit to reduce tax assessments to judgment, set aside fraudulent conveyances, and foreclose federal tax liens)
Meyer v. Commissioner, T.C. Summary Opinion 2007-181 (U.S. Tax Court suit of tax deficiency involving separate entity theory and corporations)
Struck v. Commissioner, T.C. Memo 2007-42 (U.S. Tax Court suit of tax deficiency involving the foreign earned income tax exclusion and international taxation issues)

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[accordion-item title="[+] Publications" tag="h5"]

IRS recommendations in actions relating to Tax Court Decisions, California Network Newsletter (August 2013)
Update on the FBARs, California Network Newsletter (May 2013)
Tax-Exempt Mortgage Bonds: A Way to Alleviate the Self-Inflicted Damage Caused by CALHFA’s Reading of IRC Sec. 143, 2013, State Bar of California, Sacramento Delegation (Feb. 2013)
California Tax Network Newsletter, (Feb. 2013 Ed.)
The Franchise Tax Board Gets More “Firm” About Collecting Delinquent Taxes, California Tax Lawyer, V. 21, No. 3 (Fall 2012)
California Tax Network Newsletter (Nov. 2012 Ed.)
Senate Bill 86 Financial Institution Records Match, Los Angeles & San Francisco Daily Journals (Aug. 2012)
Proposed Revision to Administrative Procedure for Collection Due Process Hearings Pursuant to IRC Section 6330, State Bar of California, Washington DC Delegation (May 2012)
Lack of Statutory Levy Restrictions on Retirement Accounts, State Bar of California, Washington DC Delegation, Tax Notes Today 2011 TNT 111-39 (2011)

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