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Schedules C activity. Petitioners received full refunds of all
taxes withheld for the years in issue. A record of substantial
losses over many years and the absence of any likelihood of
achieving a profitable operation are important factors bearing on
the taxpayer's true intention. Hendricks v. Commissioner, 32
F.3d 94, 99 (4th Cir. 1994), affg. T.C. Memo. 1993-396; Golanty
v. Commissioner, 72 T.C. at 426-427; Bessenyey v. Commissioner,
45 T.C. 261, 274 (1965), affd. 379 F.2d 252 (2d Cir. 1967).
The remaining factors suggested by the income tax
regulations warrant only a brief note. Nothing in the record
shows, and petitioners did not argue, that petitioner used any
assets in her writing activity that would appreciate in value.
Petitioners' Federal income tax returns reflect a history of
losses from her writing activity, which is also reflective of the
extent of petitioner's success or lack thereof in carrying on her
writing activity. Petitioners' financial status is such that it
does not influence the analysis in either direction. Finally,
the record indicates that petitioner enjoys her status as a self-
published writer.
Petitioner has failed to prove that she had an actual and
honest profit objective for the taxable years at issue. See
Dreicer v. Commissioner, 78 T.C. at 645; see also Lesher v.
Commissioner, T.C. Memo. 1991-161; Klapper v. Commissioner, T.C.
Memo. 1990-372, affd. without published opinion 935 F.2d 1278 (2d
Cir. 1991); Sherman v. Commissioner, T.C. Memo. 1989-269, each
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