T.C. Memo. 1999-56
UNITED STATES TAX COURT
FRANK K.B. WHEELER, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 8269-97. Filed February 26, 1999.
During 1993, 1994, and 1995, P conducted a videotape
activity. P bought significant amounts of equipment,
claimed large deductions (primarily depreciation), and
generated little receipts during the years in issue.
1. Held: On the facts, P’s activity was not engaged
in for profit; deductions in excess of income from the
activity were properly disallowed. Sec. 183, I.R.C. 1986.
2. Held, further, P is liable for negligence
additions to tax. Sec. 6662, I.R.C. 1986.
Barbara Morlan DeCaro, for petitioner.
Steven L. Walker, for respondent.
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