-8-
20 to 25 hours per week to the business during the summer months.
Neil Lamb owned the remaining stock outstanding. MLHC had gross
receipts in 1990 and 1991 of $3,387,549 and $4,231,685,
respectively. In 1990, Mr. Lamb had a nonpassive loss from MLHC
in the amount of $3,132; in 1991, his share of the subchapter S
profits was $34,396.
During 1990 and 1991, Mr. Lamb held a 50-percent interest in
the profits, losses, and capital of the D and N Partnership (D
and N), in Brunswick, Maine. D and N reported losses in 1990 and
1991 of $8,554 and $2,957, respectively. In addition, Mr. Lamb
had a 50-percent interest during 1990 in the profits, losses, and
capital of the GLS Partnership (GLS) in Brunswick, Maine. GLS
had income for the year of $60,655.
OPINION
The primary issue for decision is whether Mr. Lamb’s tuna
fishing activity was an activity that was “not engaged in for
profit” within the meaning of section 183(c). Section 183(a)
provides generally that if an activity is not engaged in for
profit, no deduction attributable to such activity shall be
allowed, except as otherwise provided in section 183(b).3
3Sec. 183(b)(1) permits a deduction for expenses that are
otherwise deductible without regard to whether or not the
activity is engaged in for profit, such as interest and personal
property taxes. Sec. 183(b)(2) permits a deduction for expenses
that would be deductible only if the activity were engaged in for
(continued...)
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