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The principal activities relating to petitioner's scrap
metal recycling business consist of the collection, processing,
and resale of scrap metal, the principal aspects of which are
performed at petitioner's warehouse. The warehouse appears to be
a facility with unique or special characteristics capable of
processing and storing scrap metal. These activities are not
performed in petitioner's home office.
The administrative, management, and other activities
performed in petitioner's home office certainly constitute a
relevant part of petitioner's business, but because the scrap
metal is collected and processed at the warehouse, the warehouse
is to be regarded as the principal place of petitioner's scrap
metal recycling business.
Petitioner argues that negotiations for the purchase and
sale of scrap metal that he conducts primarily over the telephone
from his home office constitute the principal activity of his
business. Petitioner, however, has not established in this case
that the actual purchase and sale of scrap metal is to be treated
as occurring in his home office, nor that negotiations for the
purchase and sale of scrap metal that are conducted over the
telephone from his home office constitute the principal activity
of the business.
Further, for expenses of a home office to qualify for
deductibility under section 280A, no personal use may be made of
the particular area of a residence that is used as the home
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