- 12 - still held title to the equipment and which remained in existence at least until July 1, 1988.6 Petitioners argue that even if the manufacturing equipment was idle after petitioner acquired it, he nevertheless should be considered to be in the trade or business of metal fabrication, because he continued, albeit unsuccessfully, to pursue new work orders until the equipment was repossessed by NAC in the summer of 1990. Apart from petitioner’s self-serving and uncorroborated testimony, however, there is no evidence of such business activity. Petitioner’s testimony does not credibly establish that he was involved in his personal capacity in the metal fabrication business with continuity or regularity, with the primary purpose of producing income or profit. Cf. Commissioner v. Groetzinger, 480 U.S. at 35. To the contrary, petitioner testified that during the years at issue, he was so busy in his family law practice that petitioners were unable even to file timely tax returns. Having failed to establish that they were engaged in the trade or business of manufacturing vending machines, petitioners have failed to show that the depreciable assets were used in a 6 That Pacer remained in business on July 1, 1988, is indicated by the July 1, 1988, asset sale agreement between Pacer and Venco, which states that Pacer “contemplates the cessation of all business operations, and the potential of filing for protection under the Bankruptcy Code of the United States of America.”Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011