- 12 - regarding his level of trading activity. Rule 142(a). We conclude, therefore, that petitioner is an investor regarding his securities transactions and not a trader. As such, petitioner was not conducting a trade or business. Equitable Estoppel Petitioner argues that correspondence from respondent requesting further information regarding petitioner's Schedule C expenses constitutes an audit of petitioner's 1989 Federal income tax return. Petitioner contends that respondent is estopped from reclassifying petitioner's net losses for 1992 from securities transactions as ordinary losses because petitioner's securities transactions during 1989 through 1992 were consummated in a similar manner, and respondent accepted petitioner's representation that the securities transactions in 1989 gave rise to ordinary gains. It is well established that the estoppel doctrine should be applied against the Commissioner with the utmost caution and restraint. Schuster v. Commissioner, 312 F.2d 311, 317 (9th Cir. 1962), affg. in part and revg. in part 32 T.C. 998 (1959), affg. in part and revg. in part First Western Bank & Trust Co. v. Commissioner, 32 T.C. 1017 (1959); Boulez v. Commissioner, 76 T.C. 209, 214-215 (1981), affd. 810 F.2d 209 (D.C. Cir. 1987); Estate of Emerson v. Commissioner, 67 T.C. 612, 617 (1977). Taxpayers must prove at least the following elements beforePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011