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meaning of section 183. Thus, in effect, respondent
determined that the activity of each partnership was an
"activity other than one with respect to which deductions
are allowable for the taxable year under section 162 or
under paragraph (1) or (2) of section 212." Sec. 183(c).
Petitioners do not contend that the partnerships are
entitled to deductions under section 212. Accordingly, we
must redetermine whether EA 83-XII and EA 84-III are
entitled to deductions under section 162 during the taxable
years in issue. See Brannen v. Commissioner, 722 F.2d at
704.
Section 162(a) provides for the deduction of all
ordinary and necessary expenses paid or incurred during the
taxable year in carrying on a trade or business. See sec.
162(a). It is settled that in order to constitute the
carrying on of a trade or business under section 162(a),
the activity must be entered into in good faith with
the dominant hope and interest of realizing a profit.
See, e.g., Brannen v. Commissioner, supra at 704; Siegel
v. Commissioner, 78 T.C. at 698. As we have noted in many
cases, the taxpayer must show that he or she had an "actual
and honest objective of making a profit." E.g., Marine
v. Commissioner, 92 T.C. 958, 988 (1989); Hulter v.
Commissioner, 91 T.C. 371, 392-393 (1988); Dreicer v.
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