- 12 - Petitioner stated at trial that selling articles did not pay well, and he offered no indication as to how much he could receive from the sale of an article. Petitioner testified that the sale of a novel would pay well, but no amount was offered nor has he had a contract with a literary agent since he started the activity. Petitioner did not explain how he expected to recoup the $57,156 in losses. Petitioner argues that he did have a profit objective since he submitted articles only to periodicals that offered compensation. However, petitioner’s articles were not accepted for publication for a number of years (at least since 1978), and it does not appear that petitioner attempted to develop a strategy to get published or made changes in order to succeed. Petitioner did submit his two novels to two literary agents prior to the years at issue. Petitioner did not enter into any contracts with the agents. It is not clear from the record whether petitioner submitted any novels to agents during the years at issue. 2. Expertise of Petitioner and His Advisers Preparation for an activity by extensive study or consultation with experts may indicate a profit objective where the taxpayer conducts the activity in accordance with such study or advice. See sec. 1.183-2(b)(2), Income Tax Regs.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011