Jeffrey Tamms - Page 10




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               The regulations under section 183 provide a nonexclusive               
          list of factors to be considered in determining whether an                  
          activity is engaged in for profit.  The factors include:  (1) The           
          manner in which the taxpayer carries on the activity; (2) the               
          expertise of the taxpayer or his or her advisers; (3) the time              
          and effort the taxpayer expended in carrying on the activity; (4)           
          the expectation that assets used in the activity may appreciate             
          in value; (5) the taxpayer’s success in carrying on other                   
          activities; (6) the taxpayer’s history of income or loss with               
          respect to the activity; (7) the amount of occasional profits, if           
          any, which are earned; (8) the taxpayer’s financial status; and             
          (9) whether elements of personal pleasure or recreation are                 
          involved.  Sec. 1.183-2(b), Income Tax Regs; see also Golanty v.            
          Commissioner, supra.                                                        
               On the basis of the totality of the evidence in the record,            
          we conclude that for the years in issue, petitioner had a good              
          faith expectation of profit from his Schedule C activity.  In               
          reaching this conclusion, we view the following factors as being            
          particularly persuasive:  Petitioner carried on his activity in a           
          businesslike manner, keeping, as respondent acknowledges on                 
          brief, “fairly extensive financial records for his Schedule C               
          activity.”  Petitioner responded to JJT’s lack of profitability             
          in earlier years by developing a successful business plan to                
          expand JJT’s undertakings into producing photography exhibitions.           






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