Ralph E. Wesinger, Jr. and Catherine R. Wesinger - Page 1

                                 T.C. Memo. 1999-372                                  

                               UNITED STATES TAX COURT                                

          RALPH E. WESINGER, JR. AND CATHERINE R. WESINGER, Petitioners v.            
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket Nos. 17610-97, 12694-98.      Filed November 8, 1999.           

                    Ps deducted losses sustained in their cattle-                     
               ranching and aircraft-rental operations.  R disallowed                 
               these deductions on the grounds that the ranching and                  
               rental activities were not engaged in for profit within                
               the meaning of sec. 183, I.R.C., and also assessed                     
               accuracy-related penalties under sec. 6662, I.R.C.                     
                    Held: On the facts, the cattle-ranching and                       
               aircraft-rental activities were not engaged in with a                  
               profit objective, and Ps are not entitled to deduct the                
               losses therefrom.                                                      
                    Held, further, Ps failed to establish that they                   
               exercised reasonable care in deducting such losses and                 
               are thus liable for accuracy-related penalties based on                
               negligence.  R’s determinations are sustained.                         

               Steven J. Roth, for petitioners.                                       
               Andrew R. Moore and Caroline Tso Chen, for respondent.                 

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