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Is anyone familiar with IRS SEC 469(C)(7)(A) Electing to group local properties? I made the election thinking it would result in an outcome to increase of Allowed Passive Losses converting from Prior Year Unallowed Passive Losses. My client has multiple properties locally and in other parts of the country and in 2015 sold a local property and purchased another local property. My understanding of the section was in grouping the local properties would result in the higher Allowed Passive Losses. In audit the agent said, based on her understanding of the section, the only way to release/convert from unallowed to allowed would be to sell ALL of the newly grouped properties. Can anyone give me their interpretation with any support. This would have a significant impact on the outcome so I can use all the assistance I can get. Thank you!