- 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 bePage: Previous 1 2 3 4 5 6 7 Next
Last modified: May 25, 2011