Robert L. and Joanne Tammaro - Page 5




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          1992, no deficiency in income tax resulted for any of those years           
          because of the aforementioned NOL in 1990 attributable to                   
          petitioner's accounting practice.                                           
               Respondent disallowed the losses claimed by petitioner from            
          the horse activity on the ground that such activity was not                 
          pursued with the requisite profit objective.  See secs. 162(a),             
          212, 183; see also Dreicer v. Commissioner, 78 T.C. 642, 645                
          (1982), affd. without opinion 702 F.2d 1205 (D.C. Cir. 1983).               
               In determining that petitioner’s horse activity was not                
          conducted with the requisite profit objective, respondent relied            
          on findings in the revenue agent’s report (RAR), including, in              
          particular, the following: (a) That petitioner did not maintain a           
          formal business plan or prepare projections on profitability or             
          consider stop-loss points, that petitioner estimated losses, and            
          that petitioner did not maintain accurate books and records of              
          the activity, see sec. 1.183-2(b)(1), Income Tax Regs.; (b) that            
          petitioner did not invest a significant amount of time and effort           
          in the horse activity, relying in part on the fact that                     
          petitioner also owned and operated an accounting firm and owned             
          and managed two rental properties, see sec. 1.183-2(b)(3), Income           
          Tax Regs.; (c) that EIP did not own any assets with the potential           
          to appreciate in value sufficient to overcome the losses                    
          sustained in the activity, see sec. 1.183-2(b)(4), Income Tax               








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