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are entitled to the claimed deductions. Respondent is sustained
to the extent petitioners deducted loan origination fees above
those ratably allocable to the 1989 tax year.
Christmas Tree Farm
The Dickersons claimed Schedule C expense deductions with
regard to a tree farm business in the amounts of $1,345 and
$1,100 in the 1989 and 1990 tax years, respectively. The
Dickersons claimed Schedule C losses for the tree farm business
in the tax years 1985, 1986, 1987, 1988, 1989, and 1990. The
Dickersons reported zero receipts with regard to the tree farm
business in the 1985, 1986, 1987, 1988, and 1989 tax years. The
Dickersons reported $800 in receipts with regard to the tree farm
business in the 1990 tax year. Respondent argues that the
Dickersons are not entitled to the claimed deductions because the
tree farm business was not engaged in for profit within the
meaning of section 183. This is a factual inquiry requiring a
weighing of the evidence in the record. Petitioners contend that
they entered into and carried on the tree farm activity with the
requisite profit objective and that, as a result, the deductions
are allowed under section 162 or section 212.
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 provided in section 183.
Section 183(c) defines an “activity not engaged in for
profit” as “any activity other than one with respect to which
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