George W. and Margaret L. Gagnon - Page 9

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          holidays, and possibly for retirement.  This is quite obvious               
          from petitioner's testimony.  Petitioners went to Long Beach in             
          search of a second home, not to invest in a business.  The idea             
          of the nursery was an afterthought.  The tail of the nursery                
          cannot wag the dog of the second home.                                      
               Expenses associated with a vacation home are personal and              
          nondeductible except as otherwise expressly provided in the Code.           
          Sec. 262(a).  Furthermore, section 280A(a) limits the deductions            
          that may be allowed "with respect to the use of a dwelling unit             
          which is used by the taxpayer during the taxable year as a                  
          residence."  During the years in question, petitioners used, at             
          least, the cottage on the Oregon Street property as a residence.            
               It may not necessarily flow from this scenario that the                
          nursery activity was not entered into for profit.  See Hughes v.            
          Commissioner, T.C. Memo. 1995-202.  We have no question that                
          petitioner may have devoted many arduous hours to the nursery               
          activity.  Based on the record before us, it is virtually                   
          impossible to separate the ordinary and necessary expenses of the           
          nursery activity from the personal expenses of the second home.             
          For example, petitioners claimed deductions for utilities and               
          interest expenses, but we have no evidentiary basis on which to             
          allocate these expenses between business and personal.  It may be           
          argued that, for example, the car and truck expenses are solely             
          associated with the nursery activity.  But, we simply cannot                
          accept that there were no personal motivations in the travel to             




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