Richard H. Daley and Estate of Anne H. Daley, Deceased, Richard H. Daley, Executor - Page 16

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          T.C. 659 (1979).  In light of the instant facts, we find that               
          petitioner's history of losses suggests that he lacked a profit             
          motive in carrying on his horse activity.  Accordingly, we find             
          that this factor favors respondent.                                         
          Amount and Frequency of Occasional Profits                                  
               The amount and frequency of occasional profits earned from             
          the activity at issue may also be indicative of a profit                    
          objective.  Sec. 1.183-2(b)(7), Income Tax Regs.  Petitioner's              
          horse activity had several sources of income, yet none proved               
          fruitful.  While an opportunity to earn a substantial ultimate              
          profit in a highly speculative venture may be sufficient to                 
          indicate that the activity is engaged in for profit even though             
          only losses are generated, sec. 1.183-2(b)(7), Income Tax Regs,             
          we are convinced that such a likelihood was too remote in the               
          instant case.  Accordingly, we find that this factor favors                 
          respondent.                                                                 
          Petitioner's Financial Status                                               
               The lack of substantial income from sources other than the             
          activity in question may indicate the existence of a profit                 
          motive with respect to such activity.  Sec. 1.183-2(b)(8), Income           
          Tax Regs.  As petitioner is a successful orthopedic surgeon                 
          earning in excess of $250,000 per year, there is little doubt               
          that this factor favors respondent.                                         








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