Lee Tanaka spent 225 hours in the tax year working with Partnership Q, a gardening store. He also worked 140 hours with a floral design partnership that does decorations for weddings and funerals. Finally, he spent 155 hours in a new business selling flowers to hospitals. None of the entities are PTPs. He is considered a(n) _______________ for all activities.

Respuesta :

Answer:

material participant

Explanation:

In order to be considered a material participant in a business, you have to work at least 100 hours. The IRS allows material participants to include business income as regular earned income, instead of passive income.

Since Lee worked more than 100 hours in each of these businesses, he will be considered a material participant in all of them.