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Moreover, petitioners made no showing that Blue Ribbon would have
been profitable had the horses not suffered injury. See, e.g.,
Burger v. Commissioner, 809 F.2d 355 (7th Cir. 1987), affg. T.C.
Memo. 1985-523.
7. The Amount of Occasional Profits, If Any, Which Were
Earned
The amount and frequency of occasional profits earned from
the activity may also indicate a profit objective. Sec. 1.183-
2(b)(7), Income Tax Regs. It is uncontroverted that Blue Ribbon
never reported a profit from its horse-related activities. The
occasional revenues Blue Ribbon generated from horse shows and
the provision of riding lessons during the years in issue were de
minimis compared to the expenses and depreciation incurred.
Nonetheless, petitioners contend that the opportunity to earn a
substantial ultimate profit in a highly speculative venture is
ordinarily sufficient to indicate that the activity is engaged in
for profit even though losses or only occasional profits are
actually produced. Id. Additionally, petitioners contend that a
small chance of making a large profit may indicate the requisite
profit objective. Sec. 1.183-2(a), Income Tax Regs.
Petitioners, however, offered no evidence to indicate that Blue
Ribbon stood to earn a large or substantial profit during the
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