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as New York, Denver, Atlanta, Orlando, and Minneapolis. For the
3 years in issue, petitioners incurred expenses for travel, meals
and entertainment (M&E), and seminars in the following amounts:
1994 1995 1996
Travel $ 4,858 $ 6,664 $ 5,287
M&E (gross) 2,004 4,250 2,932
Seminars 1,394 1,805 2,376
Total $ 8,256 $12,719 $10,595
For 1994 and 1995, the total of just these amounts exceeds
petitioners’ reported gross income from Amway for those years.
Moreover, petitioners received a personal benefit from their
Amway activity through the ability to purchase Amway products for
their own use at distributor’s cost without the customary 30-
percent markup. In 1994, 1995, and 1996, petitioners purchased,
for their personal use, Amway products valued at $2,133, $3,282,
and $3,786, respectively. See Ogden v. Commissioner, T.C. Memo.
1999-397, where the purchase of $1,800 to $2,400 worth of Amway
products per year for the taxpayers’ personal use was regarded by
the Court as a factor supporting the conclusion that the
taxpayers lacked a profit objective.
Petitioners estimate that they devoted between 51 and 80
hours per week to their Amway activity, with Mrs. Nissley
spending 21 to 40 hours per week and Mr. Nissley spending 30 to
40 hours per week. Petitioners contend that devoting so much
time to their Amway activity is indicative of a profit objective.
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