Robert and Joyce Dirkse - Page 18

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          supra.  For instance, a series of startup losses or losses                  
          sustained because of unforeseen circumstances beyond the taxpayer’s         
          control may not indicate a lack of profit motive.  See sec. 1.183-          
          2(b)(6), Income Tax Regs.                                                   
               No profits have ever been generated from petitioners’ Schedule         
          C activities, and none are expected in the near future.                     
          Petitioners have been conducting their Schedule C activities well           
          beyond the length of time that can be reasonably called the                 
          “startup” period, and there is no evidence in the record indicating         
          that their Schedule C losses are the result of unforeseen                   
          circumstances.  Rather, the extended period of losses is                    
          attributable to petitioners’ unchecked expenditures and their               
          failure to develop a suitable market for their produce.  Indeed,            
          the growing disparity between petitioners’ losses and revenue               
          stream is indicative of an unprofitable undertaking and is                  
          inconsistent with petitioners’ purported intent to provide                  
          supplemental income.  Consequently, this factor weighs against a            
          finding of a profit motive.                                                 
               6.  The Amount of Occasional Profits, Earned, If Any                   
               If an activity generates only small, infrequent profits and            
          typically generates large losses, the taxpayer conducting the               
          activity may not have a profit objective.  See Golanty v.                   
          Commissioner, supra at 427; sec. 1.183-2(b)(7), Income Tax Regs.            

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