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T.C. Memo. 1991-180. Respondent, on the other hand, produced
numerous billing statements and invoices as well as testimony
regarding WVI’s expenditures for 1991. We find respondent’s
evidence persuasive.
According to petitioners, these trips were undertaken to
investigate and research Powhatan Plantation’s competition in order
to incorporate comparable resort features and services that would
make them more attractive to potential customers. We view this
assertion with skepticism. In our opinion, the innovations and
research petitioners sought could have been obtained without the
elements of substantial personal pleasure. To illustrate,
petitioners spent a large amount of time on these trips enjoying
shopping malls, theme parks, and historical locations. Many of
these trips were taken around the Thanksgiving, Christmas, or New
Year’s holidays and were the only time during the year petitioners
managed to escape their everyday routine. WVI subsidized many of
the incidental expenses incurred by the spouses of members of the
“management team”. During some of the activities, dinners costing
$1,000 or more, as well as room service bills of almost $500,
became the norm. Although it might be ordinary and necessary for
Powhatan Plantation to investigate its competition in the same
geographic area, it has not been shown to be ordinary and necessary
for petitioners to examine resorts that are located in distant
areas and are not in direct competition with Powhatan Plantation.
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