Allen C. Chamberlin and Martha L. Chamberlin - Page 22

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          See Fincher v. Commissioner, 105 T.C. 126, 136 (1995).  A                   
          nonbusiness bad debt is deductible as a short-term capital loss,            
          while a business debt is deductible as an ordinary loss.  See               
          sec. 166.                                                                   
               Petitioners contend that, from 1978 until 1984, petitioner             
          was engaged in the trade or business of promoting business                  
          ventures in the health care industry.  Respondent argues that               
          petitioner’s dominant motive for acquiring and guaranteeing loans           
          for The Chamberlin Corp. was for investment purposes and that the           
          activities of petitioner with regard to his promotion of business           
          ventures do not rise to the level of a trade or business.                   
               In order to be engaged in carrying on a trade or business,             
          the taxpayer must be involved in the activity with continuity and           
          regularity, and the taxpayer’s primary purpose for engaging in              
          the activity must be for income or profit.  See Commissioner v.             
          Groetzinger, 480 U.S. 23, 35 (1987).  Activities that are                   
          sporadic do not qualify as a trade or business.  See Polakis v.             
          Commissioner, 91 T.C. 660, 670-672 (1988).  The management of               
          one’s own investments is not considered a trade or business no              
          matter how extensive or substantial the investment activities               
          might be.  See King v. Commissioner, 89 T.C. 445, 458 (1987).               
          Resolution of this issue requires an examination of the facts of            
          each case.  See Commissioner v. Groetzinger, supra at 36.                   

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