Richard A. Stasewich - Page 11

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          profit objective.  See sec. 1.183-2(b)(9), Income Tax Regs.  We             
          previously stated, with respect to this factor:                             
               Unquestionably, an enterprise is no less a “business”                  
               because the entrepreneur gets satisfaction from his                    
               work; * * * however, where the possibility for profit                  
               is small (given all the other factors) and the                         
               possibility for gratification is substantial, it is                    
               clear that the latter possibility constitutes the                      
               primary motivation for the activity.  * * *  [Burger v.                
               Commissioner, T.C. Memo. 1985-523, affd. 809 F.2d 355                  
               (7th Cir. 1987); fn. ref. omitted.]                                    
               Based on the evidence, we conclude that petitioner did not             
          have a profit objective when he created his installation art                
          exhibits in the front of his residence.  Petitioner received only           
          nominal donations that totaled $88.04 from his installation art             
          exhibits, and such donations could not have compensated him for             
          the time or expense involved in creating his artwork.  Petitioner           
          did not seek to make a profit from his installation art exhibits,           
          but rather engaged in the artist activity because of the                    
          satisfaction, pride, and prestige that it afforded him.                     
               In the previous case of Stasewich v. Commissioner, supra, we           
          held that petitioner’s artist activity was not entered into for             
          profit for 1988 through 1991.  Petitioner has not made any                  
          significant changes in the operation of his artist activity,                
          during the years in issue here, that would create a market or               
          allow him to benefit from a market for his artwork or allow him             
          to make up for his substantial losses.  In Stasewich v.                     
          Commissioner, supra, we explained our holding in language equally           
          applicable here:                                                            

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