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incurred by petitioner in 1991 were "ordinary and necessary" in
helping to maintain the appreciated value of petitioner's drill
rig, whose original $50,000 basis had been reduced to zero by
depreciation deductions allowed.
Respondent questions the reasonableness of petitioner's
estimate of value, particularly because petitioner did not
present appraisals or expert testimony of the value of the drill
rig. Petitioner testified, however, that he was in negotiations
to sell the drill rig in 1987 for approximately $400,000. Even a
lesser increase in value would still provide petitioner with a
substantial profit, without the benefit of depreciation
deductions. See Lemmen v. Commissioner, 77 T.C. 1326, 1343
(1981). Even though petitioner's opinion regarding the value of
his drill rig may be overly optimistic, there appears to be some
substantial likelihood that petitioner will eventually realize
some profit from the sale of the drill rig. We thus find that
petitioner has proven his intention to realize a profit from the
time and effort expended on maintenance of the drill rig, at
least with respect to its ultimate sale. The lack of expert
testimony regarding the value of the drill rig speaks only to the
extent of its appreciation.
Respondent argues that petitioner did not "hold" his drill
rig with the primary objective of making a profit. However, even
if this were true, section 212(2) allows a deduction for expenses
paid or incurred for the management, conservation, or maintenance
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