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personal planner) are for the most part filled with brief
notations and numbers which give no indication of their business
nature, and to the extent that they show some business activity
they could just as easily be from petitioner’s primary employment
as from any outside business. The receipts are for an assortment
of expenses, primarily travel and meals, which show no indication
that they were incurred for any business purpose. No records
were provided showing purchases of product or inventory by
petitioner, and no sales receipts were provided showing that any
actual sales had been made to customers. In short, there is
nothing in the record which provides us with a basis for finding
that petitioner was engaged in a sales business.
Petitioner testified that he subsidized his main employment
income with the sales business income in order to help support
himself and his family. However, during the 7 years petitioner’s
business allegedly existed before and during the years in issue,
he claims to have incurred substantial losses in each year, and
in the years in issue to have had gross receipts of only $918,
$550, and $500. We do not believe that petitioner would have for
years invested so much time and effort in an activity which
yielded such poor results, and which provided his family with
negligible income even before expenses.
Petitioner argues that an IRS employee informed him in a
prior audit that his current method of maintaining records was
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Last modified: May 25, 2011