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We are satisfied that petitioner's writing activity was
conducted with continuity and regularity during the years in
issue. Nevertheless, in order for an activity to be considered a
trade or business within the meaning of section 162, a taxpayer
must conduct the activity with the requisite profit motive or
intent. See Commissioner v. Groetzinger, supra.
Consistent with the manner in which petitioners reported the
income and expenses attributable to petitioner's writing activity
on their Federal income tax returns for the years in issue, they
argue that petitioner engaged in her writing activity with the
intent to make a profit, and therefore the activity constitutes a
trade or business.
Respondent argues that petitioner's writing activity does
not constitute a trade or business because she did not engage in
that activity with the requisite intent to profit. Consequently,
according to respondent, petitioners are only entitled to deduct
the expenses related to petitioner's writing activity as
allowable under section 183.
The test of whether a taxpayer conducted an activity for
profit is whether he or she entered into, or continued, the
activity with an actual or honest objective of making a profit.
Keanini v. Commissioner, 94 T.C. 41, 46 (1990); Dreicer v.
Commissioner, 78 T.C. 642, 644-645 (1982), affd. without opinion
702 F.2d 1205 (D.C. Cir. 1983); sec. 1.183-2(a), Income Tax Regs.
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