- 11 -
asserts that petitioners did not engage in the fishing activity
with an intent to make a profit. We disagree.
Petitioners widely advertised their fishing activity and
engaged in numerous promotional activities in the expectation of
recruiting additional CAST members and thereby making a profit.
Petitioners also devoted substantial amounts of time to their
fishing activity in spite of their full-time employment
elsewhere. Petitioners’ fishing activity is, in effect, a
noncontractual franchise in which directors are allowed to use
the CAST name in their respective regions and are able to keep
part of the gross receipts from the activity while accepting
responsibility for all of the attendant incurred expenses.
Petitioners kept detailed business records and mailing lists
and constantly strove to increase the profitability of their
fishing activity. If one fishing activity practice increased
operating expenses, petitioners sought out ways to change that
aspect of the activity in an effort to reduce expenses and make
the activity more profitable. For example, petitioners were able
to reduce operating costs by soliciting local sponsors for
lodging and meals and by arranging for Ranger Boats to pay
petitioners’ boat show booth fees in exchange for publicity.
Once petitioners decided to conduct this activity to earn
income for their retirement, they sought out the expertise of Mr.
Taylor, a person who had organized over 300 fishing tournaments.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011