During the current year, Gene, a CPA, performs services as follows: 1,800 hours in his tax practice and 50 hours in an apartment leasing operation in which he has a 15% interest. Because of his oversight duties, Gene is considered to be an active participant. He expects that his share of the loss realized from the apartment leasing operation will be $30,000 while his tax practice will show a profit of approximately $80,000. Gene is single and has no other income. Discuss the character of the income and losses generated by these activities.