- 6 -
preretirement expertise. Other than the $7,710 consulting fee
earned during 1991, petitioner had no active income-producing
consulting engagements. See Commissioner v. Groetzinger, 480
U.S. 23 (1987).
Even if we were to find that petitioner’s consulting
activity reached the level of being a trade or business or other
profit-seeking activity, we are unconvinced that petitioners’
involvement in their daughter’s domestic relations difficulties
was an integral part of petitioner’s consulting activity.
Although petitioner studied domestic relations law and related
matters, he is not a lawyer and not entitled to represent the
interests of another. In that regard, there was no potential for
profit from “investing” in a divorce or child custody proceeding.
Petitioners’ assistance to their daughter is commendable, but it
is in origin and character a personal matter.
Petitioner spent a great deal of effort in researching
domestic relations law and assisting his daughter, but that alone
does not make his activity one that is profit seeking. We also
note that petitioner entered into an agreement with his daughter.
Under that agreement, petitioner would be reimbursed for his
expenditures pro rata, using the ratio of his expenditures to his
daughter’s. Once their expenditures were reimbursed, then
petitioner was to receive 30 percent and his daughter 70 percent
of any recovery that exceeded the cost of the domestic relations
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011