§496

erforming services each year. Therefore, petitioner husband materially participated and petitioners' rental activity for the years in issue was not passive for the purpose of section 469(c)(1)(B). We find that for the years in issue petitioner husband has established that he satisfies the requi ements to qualify as a real estate professional under section 496(c)(7). - 15 - Any contentions we have not addressed are irrelevant, moot, or meritless. Decision will be entered under Rule 155.

Whether the allowance provided by section 496(i) applies to the Adeyemos' rental real-estate business The Adeyemos raise the alternative argumentthat, ifMr.

lly participates." Sec. 469(c)(2). A taxpayerwho engages in the rental real estate business is not statutorily consideredto be engaged in a passive activity under section 469(c)(2) ifhe can show that he is a qualifying real estate professional under section 496(c)(7). See also sec. 1.469-9(e)(1), Income Tax Regs. Specifically, section 469(c)(7)(B) sets forth the following requirements: 3The parties did not raise the question ofburden ofproof. The sole question we consider is whether petitioners

wed. See Ewing v. Commissioner, 20 T.C. 216, 229 (1953) (payment only from operating profits), affd. on other grounds 213 F.2d 438 (2d Cir. 1954); Clark v. Commissioner, supra (payment only from dividends on certain stock); 17A Am. Jur. 2d Contracts sec. 496 (1991) (promise to pay out of a specified fund generally renders contract conditional). But cf. Clay Drilling Co. v. Commissioner, 6 T.C. 324 (1946) (bad debt deduction allowed even though debt was repayable only from future commissions to b