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Section 1.183-2(b), Income Tax Regs., provides a nonexclu-
sive list of factors to be considered in determining whether an
activity is engaged in for profit. The factors include: (1) The
manner in which the taxpayer carried on the activity; (2) the
expertise of the taxpayer or his advisers; (3) the time and
effort expended by the taxpayer in carrying on the activity;
(4) the expectation that the assets used in the activity may
appreciate in value; (5) the success of the taxpayer in carrying
on other similar or dissimilar activities; (6) the taxpayer's
history of income or losses with respect to the activity; (7) the
amount of occasional profits, if any, which are earned; (8) the
financial status of the taxpayer; and (9) whether elements of
personal pleasure or recreation are involved.
On the basis of all of the evidence presented at trial, we
conclude that petitioner lacked the requisite profit motive in
carrying on his minority education business. Petitioner
described his business as minority education programs that local
municipalities and school districts would purchase and thereby
become eligible for grant money from the Department of Education.
However, the record lacks even basic information concerning
petitioner's minority education programs. It is unclear what
subject matter, or grade level, was being targeted by peti-
tioner's programs. Petitioner did not disclose what type of
academic materials were associated with his minority education
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Last modified: May 25, 2011