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the farming activity and the holding of the land cannot be
construed to be a single activity. Petitioners may not utilize
the appreciation of the land to support their argument that it
should offset the farming losses. See also Hoyle v.
Commissioner, T.C. Memo. 1994-592. In that regard, we find that
petitioners’ expenditures and primary intent were, as evidenced
by the nature of their activity and claimed losses, attributable
to farming rather than improvement of the realty.
The Success of the Taxpayers in Carrying On Other
Activities. Petitioners did not present any evidence that they
had been previously engaged in farming activities, or similar
activities. Petitioner husband was successful in his
professional activities, but there is no showing that he employed
his fiscal and financial experience from his professional
activity in his farming activity.
Amount of Occasional Profit. Petitioners have not earned
any profit from the farming activity during any of the years
about which there is evidence in the record.
The Financial Status of the Taxpayers. Substantial income
from sources other than the activity in question, especially if
the losses generate significant tax benefits, may indicate that
the activity is not engaged in for profit. Sec. 1.183-2(b)(8),
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