Skeeter Invests in Vacant Land for the Purpose of Realizing

Skeeter invests in vacant land for the purpose of realizing a profit on its appreciation.He leases the land during the period he holds it.The unadjusted basis of the property is $75,000 and its fair market value is $105,000.The lease payments are $1,200 per year.

A) The leasing activity will be treated as a rental activity and will be treated as a passive activity regardless of how many hours Skeeter participates.
B) The leasing activity will be treated as a rental activity and will not be treated as a passive activity if Skeeter qualifies as a real estate professional.
C) The leasing activity will not be treated as a rental activity.
D) The leasing activity will be treated as a rental activity and will not be treated as a passive activity if Skeeter devotes more than 500 hours to the activity.
E) None of the above.