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The issues remaining for decision are:
(1) Was the drawing that petitioner sold during 1989
"property held by the taxpayer primarily for sale to customers in
the ordinary course of his trade or business" within the meaning
of section 1221(1)? We hold that it was not, and we further hold
that the gain that petitioner realized from the sale of that
drawing is long-term capital gain.2
(2) Did petitioner engage in his horse activity during
1989, 1990, and 1991 and his cattle activity during 1990 and 1991
with the objective of making a profit within the meaning of
section 183? We hold that he did not.
(3) Is petitioner liable for 1989 and 1990 for the addition
to tax under section 6651(a)(1)? We hold that he is not for 1989
and that he is for 1990 to the extent stated herein.
(4) Is petitioner liable for 1989, 1990, and 1991 for the
accuracy-related penalty under section 6662(a)? We hold that he
is to the extent stated herein.
2 The parties agree that the Court's holding on the character-
ization of petitioner's gain from that sale will be dispositive
of the remaining issues presented under secs. 404(h)(1)(C) and
4972(a).
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