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his taxable years 1988 through 1992, he described his principal
business as “hotel resort”; for his taxable years 1993 through
1995, he described his principal business activity as “hotel
resort, solar electronics manufacture & sale”. He reported gross
income and expenses as follows:
Year Gross Income Expenses Net Gain/Loss
1988 $0 $14,642 $(14,642)
1989 0 34,049 (34,049)
1990 0 82,792 (82,792)
1991 339 70,703 (70,364)
1992 8,420 61,883 (53,463)
1993 15,368 94,508 (79,140)
1994 160,204 113,235 46,969
1995 109,799 99,569 10,230
For those years, petitioner's gross income is broken down further
as follows:
Total Gross Income Gross Income
Year Gross Income from Resort from Solar Sales
1988 $0 $0 $0
1989 0 0 0
1990 0 0 0
1991 339 339 0
1992 10,977 6,424 4,553
1993 16,021 11,891 4,130
1994 160,365 10,375 149,990
1995 164,487 6,211 158,276
OPINION
I. Deficiencies
A. Section 183--For-Profit Requirement
Section 183(a) provides: "In the case of an activity
engaged in by an individual or an S corporation, if such activity
is not engaged in for profit, no deduction attributable to such
activity shall be allowed under this chapter except as provided
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Last modified: May 25, 2011