- 18 - recreational elements involved.” Golanty v. Commissioner, 72 T.C. at 428-429; see Ransom v. Commissioner, T.C. Memo. 1990-381. In the present case, petitioners are well-educated, professional individuals, licensed as C.P.A.’s, who earn substantial salaries from their full-time employment, as demonstrated by the following table for the years in issue: 1994 1995 1996 Mr. Nissley $ 65,674 $ 67,916 $ 70,810 Mrs. Nissley 80,660 75,010 75,010 Total $146,334 $142,926 $145,820 For 1994, 1995, and 1996, petitioners claimed losses from their Amway activity in the amounts of $27,407, $33,539, and $27,787, respectively. Petitioners used those losses to reduce their compensation and other income, thereby decreasing their taxable income and achieving substantial tax savings. Those tax savings helped to finance everyday expenses such as outlays for car and home.5 5 For 1994, 1995, and 1995, petitioners deducted car expenses in the amounts of $6,794, $13,214, and $11,070, respectively. For each of the first two of those years, the amount deducted for just this single expense exceeded petitioners’ reported gross income from Amway for the year. For 1994, 1995, and 1996, petitioners also claimed deductions for use of home in the amounts of $1,265, $2,510, and $2,485, respectively; for 1994, they also claimed a deduction for utilities in the amount of $4,861. For 1994, the sum of just these two deductions exceeded petitioners’ reported gross income from Amway for that year.Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Next
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