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(1979), affd. without published opinion 647 F.2d 170 (9th Cir.
1981).
Section 1.183-2(b), Income Tax Regs., provides the following
nonexclusive list of nine factors that should normally be taken
into account in determining whether an activity is engaged in for
profit: (1) The manner in which the taxpayer carries on the
activity; (2) the expertise of the taxpayer or his advisers; (3)
the time and effort expended by the taxpayer in carrying on other
similar or dissimilar activities; (4) the expectation that the
assets used in the activity may appreciate in value; (5) the
success of the taxpayer in carrying on other similar or
dissimilar activities; (6) the taxpayer's history of income or
losses with respect to the activity; (7) the amount of occasional
profits, if any, that are earned; (8) the financial status of the
taxpayer; and (9) the elements of personal pleasure or recreation
involved in the activity.
A review of the entire record in this case persuades us that
petitioner has succeeded in proving that his horse activity was
motivated by an actual and honest objective of making a profit.
We find that most of the above-enumerated factors weigh in favor
of petitioner; we find further that those factors not in
petitioner's favor do not require a decision for respondent.
First, the manner in which the taxpayer carries on the
activity is one indication of a profit objective. Engdahl v.
Commissioner, 72 T.C. 659 (1979); Grommers v. Commissioner, T.C.
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