- 9 - activities on the four properties (collectively, the Melrose, Chireno, and Colorado ranches and the Kerrville farm are referred to as the four properties). Also, petitioners failed to maintain logs or journals with regard to their participation in the activities on the four properties. Petitioners, however, did consult with local government conservation agencies about how best to restore and improve the four properties. Throughout their ownership of the four properties, petitioners reported losses. Specifically, for the years 1986 to 1994, petitioners incurred losses (excluding depreciation deductions) totaling $1,284,349. As for the years in issue, petitioners claimed the following losses with regard to the ranching and farming activities: Ranching and Farming Taxable Year Losses 1992 $122,893 1993 205,331 1994 261,469 Rental Properties In February 1992, petitioners purchased the St. John rental property for $375,000. In December 1992, petitioners transferred a one-half interest in the St. John rental property to the Jorgenson Family Credit Shelter Trust (the Trust). On their 1994 tax return, petitioners reported $149,230 in expenses with regard to the St. John rental property on Schedule E. On the notice of deficiency, respondent determined that petitioners and the TrustPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011