- 4 -
when I could be working with people who could afford to pay for
my services.” She further stated: “I intended to have a
business called Conversation With Connection. It will be when I
retire from the school district.” Petitioner is not retired from
the school district.
Petitioner deducted on her Schedule C expenses which were
personal expenses not deductible under section 262. She deducted
moneys paid to a handyman to paint her house. She deducted
moneys paid for a carpet delivered to her house. She deducted a
gift (a membership in the Screen Actor’s Guild) to a friend’s
daughter. She deducted payments to a person who repaired her
personal automobile. She deducted payments for assistance during
a funeral. Thus, petitioner’s use of her Schedule C allowed her
to claim deductions for many nondeductible personal expenses.
Section 183(a) disallows any deductions attributable to
activities not engaged in for profit except as provided under
section 183(b). A taxpayer need not have a reasonable
expectation of profit. However, the facts and circumstances must
demonstrate that he or she entered into the activity, or
continued the activity, with the actual and honest objective of
making a profit. Taube v. Commissioner, 88 T.C. 464, 478 (1987);
Dreicer v. Commissioner, 78 T.C. 642, 645 (1982), affd. without
opinion 702 F.2d 1205 (D.C. Cir. 1983); sec. 1.183-2(a), Income
Tax Regs. The taxpayer's objective to make a profit must be
Page: Previous 1 2 3 4 5 6 7 Next
Last modified: May 25, 2011