Stanley P. Zurn - Page 26

          $20,938 ($161 for mortgage interest and $20,777 for                         
               Respondent argues that petitioner is not entitled to the               
          amounts claimed because of his failure to substantiate the                  
          amounts and show that the leasing activity was a trade or                   
          business and/or a profit-seeking activity.  The lease of the road           
          construction and related machinery was integrated with the joint            
          venture and lending activity between petitioner and Ms. Jackson.            
          We have already decided that the overall activity was a trade or            
          business, in the form of a joint venture, and that the leasing              
          activity is covered within our analysis in the preceding issue.             
          Based on our prior findings and analysis, we find that                      
          petitioner's leasing activity was a trade or business and/or an             
          activity entered into for profit.                                           
               The record here supports petitioner's ownership of $100,000            
          of equipment that he leased to Cities.  Petitioner, however, has            
          not substantiated any of the amounts claimed for legal fees,                
          mortgage interest, or "other expenses" which he claimed on the              
          Schedules C.  With respect to the amounts claimed for insurance,            
          the $40,000 amount has been found to be a part of petitioner's              
          capital investment in the joint venture with Ms. Jackson.  The              
          other amount claimed for insurance ($3,516) has not been                    
          substantiated by petitioner.                                                

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Last modified: May 25, 2011