United States Ninth Circuit

A tax court ruling that petitioners could not apply losses from their various rental properties to offset rental income derived from leases of office space in their home to lessee corporations which they happen to own is affirmed where: 1) the IRS's self-rental rule is valid and is not contrary to Internal Revenue Code section 469; 2) Congress validly delegated authority to the Secretary of the Treasury to promulgate regulations pursuant to section 469; and 3) the applicability of the regulation at issue is not limited to instances in which a specific tax-avoidance motive is alleged and proven by the Commissioner.

Appellate Information

• Decided 03/23/2007
• Published 03/23/2007

Judges

• COVELLO, District Judge., Before RONALD M. GOULD and MILAN D. SMITH, JR., Circuit Judges, and ALFRED V. COVELLO, District Judge.

Court

• United States Ninth Circuit

Counsel

• For Appellant:
  
• Edward B. Simpson, San Francisco, CA;  John Gigounas, San Francisco, CA, for the petitioners-appellants.


• For Appellees:
  
• Eileen J. O'Connor, Assistant Attorney General, Washington, D.C.;   Kenneth L. Greene, Tax Division, Department of Justice, Washington, D.C.;  Deborah K. Snyder, Tax Division, Department of Justice, Washington, D.C., for the respondent-appellee.