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practices, that one would expect of individuals pursuing an
activity with a profit objective. See Ogden v. Commissioner,
T.C. Memo. 1999-397; Theisen v. Commissioner, T.C. Memo. 1997-
539; Hart v. Commissioner, T.C. Memo. 1995-55. Thus, petitioners
did not maintain any written business plan for their Amway
activity (other than the Amway “6-4-2 plan”). Further,
petitioners did not maintain either a written budget or a monthly
report of expenses, nor did petitioners prepare a break-even
analysis.
Also of significance is the fact that petitioners had no
experience with the Amway-type of activity prior to the time that
they were recruited by an Amway distributor. See sec. 1.183-
2(b)(2), Income Tax Regs. Since that time, petitioners have
relied only on advice from one of their “upline” distributors and
other interested Amway individuals. Yet, under the Amway system,
the “upline” distributor’s bonus is not directly affected by the
“downline” distributor’s profitability or lack of profitability;
rather, it is the “downline” distributor’s volume of sales that
is important to the “upline” distributor. Nevertheless,
petitioners have steadfastly refused to seek counsel from
disinterested third parties regarding means by which their Amway
activity might be made profitable. See Poast v. Commissioner,
T.C. Memo. 1994-399 (“for the most part, petitioners’ advisers
were not experts as much as they were upliners with a financial
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