- 41 -
calves and incurred expenses in that same amount in connection
with his cattle activity. During 1992, 1993, and 1994, peti-
tioner received $1,017, $1,275, and $1,083, respectively, from
the sale of the calves, but the record does not disclose the
expenses that he incurred during those years in connection with
his cattle activity.31
Petitioner did not project during 1990, or at any other
time, the future income, expenses, or profits that he expected
would be generated by his cattle activity. Although during 1990
and 1991 petitioner retained invoices, receipts, and canceled
checks relating to the expenses incurred in his cattle activity,
he did not maintain a separate bank account for that activity or
books or records, such as ledgers and registers, to memorialize
the various transactions relating thereto or to maintain a
historical record of that activity (e.g., the dates on which
calves were born and sold).
To support his contention that he was engaged in his cattle
activity during 1990 and 1991 with a profit motive, petitioner
relies on his receipt of income from the sale of calves during
1991 through 1994 in amounts ranging from $1,017 to $1,275.32
Receipt of income is not necessarily indicative of a profit
31 Petitioner testified that he incurred virtually no expenses
in connection with his cattle activity, other than annual ex-
penses of approximately $175 to $250 for winter feed for the
cattle. We are unwilling to rely on that testimony. It is
inconsistent with his oral stipulation at trial that during 1991
he incurred expenses relating to his cattle activity of $1,024.
32 Petitioner concedes that he did not expect his cattle to
appreciate in value.
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