John Gallo - Page 11

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               sales in 1958 by reason of his temporary lack of access                
               to a source of costume jewelry to sell is not                          
               controlling. * * *                                                     
               The present case involves petitioner’s claim for deductions            
          for expenses from two separate activities, boat repair and                  
          paralegal work.  Petitioner was engaged in the boat repair                  
          business from 1959 through 1985 during which he accumulated a               
          substantial number of tools and supplies.  In 1992, petitioner              
          incurred expenses for storage for these tools and supplies.                 
          After 1985, petitioner did not perform boat repairs and did not             
          earn any income from that activity.  As the years passed, it                
          became less and less likely that petitioner would ever return to            
          that activity or that his services would be desired by boat                 
          owners or previous clients.  There is no indication in the record           
          that petitioner maintained contact with his former clients in               
          this regard.                                                                
               On the other hand, petitioner, after 1985, sought other                
          means of earning a living.  He obtained his paralegal certificate           
          in 1989 and attempted to obtain employment.  Beginning in                   
          December 1989, he was successful through 1990, earning in excess            
          of $10,000 from that activity.  All earnings from the paralegal             
          activity were as an employee.  However, it became clear that                
          because of his physical infirmities, he would be unable to handle           
          the time restraints required of an employee, but he honestly and            
          sincerely believed that he could still function and earn money as           

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