- 21 -
determinative, and not all factors are applicable in every case.
See Allen v. Commissioner, 72 T.C. 28, 34 (1979); sec. 1.183-
2(b), Income Tax Regs.
In making our evaluation of the foregoing factors, we may
consider evidence from years subsequent to the years in issue “to
the extent it may create inferences regarding the existence of a
profit motive in the earlier years.” Hillman v. Commissioner,
T.C. Memo. 1999-255 (citing Hoyle v. Commissioner, T.C. Memo.
1994-592). “[A]ctual profits or losses in those and subsequent
years have probative, although not determinative, significance in
such evaluation.” Smith v. Commissioner, T.C. Memo. 1993-140.
Petitioner contends that he had a good faith objective to
realize a profit from his mining activities during the years at
issue and, therefore, his deductions with respect to his mining
activities should not be limited by section 183. Respondent
argues that an analysis of the relevant objective factors reveals
that petitioner lacked a bona fide objective to make a profit.
B. Applying the Factors
1. The Manner in Which Petitioner Conducted the
Activity
In deciding whether a taxpayer has conducted an activity in
a businesslike manner, we consider whether complete and accurate
books and records were maintained, whether the activity was
conducted in a manner substantially similar to other activities
of the same nature that were profitable, and whether changes in
Page: Previous 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 NextLast modified: May 25, 2011