During the current year, gene, a cpa, performs services as follows: 1,800 hours in his tax practice and 50 hours in an apartment leasing operation in which he has a 15% interest.
because of his oversight duties, gene is considered to be an active participant.
he expects that his share of the loss realized from the apartment leasing operation will be $30,000 and that his tax practice will show a profit of approximately $80,000.
gene is single and has no other income.

what is the character and treatment of the income and losses generated by these activities?

a. is gene considered a material participant in the tax practice? is gene considered a material participant in the apartment leasing operation?

b. in the current year, gene can deduct $ of the real estate rental activity loss and any remaining loss is as a activity loss.