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business does not impute a profit motive to its previous owners.
See Finoli v. Commissioner, supra at 716-718, 726.
Additionally, other than Mr. Weiss' representation that he
provided accounting services for unspecified other cable
television clients, there is no basis to assume that petitioners
have ever had any particular success in similar or dissimilar
activities.
The scant evidence presented indicates that petitioners
earned no profits whatsoever from their Oshtemo-Kalamazoo
activities; they only incurred losses. Petitioners' tax returns
indicate that they used these losses to offset taxable income
generated by Mr. Weiss' unrelated activities. Finally, although
we doubt that considerations of personal pleasure entered into
petitioners' decision to engage in cable television activity, the
absence of such considerations does not appreciably aid
petitioners' attempt to demonstrate a profit objective in that
activity.
Petitioners ultimately have failed to produce evidence
showing that the Oshtemo-Kalamazoo activities were entered into
with the requisite profit motive. Accordingly, we sustain
respondent’s determination on this issue.
Economic Substance
Respondent has also disallowed the claimed loss deductions
because of petitioners' asserted failure to show the necessary
attributes of ownership required to claim the Oshtemo-Kalamazoo
assets. Instead, respondent asserts the partnership activities
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