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respondent disallowed as deductions relate to petitioners’
daughter’s stay in Atlanta in 1996.
Discussion
Under section 162(a), taxpayers are allowed a deduction for
all ordinary and necessary expenses paid or incurred during the
taxable year in carrying on a trade or business. To this end,
“the taxpayer must be involved in the activity with continuity
and regularity and * * * the taxpayer’s primary purpose for
engaging in the activity must be for income or profit.”
Commissioner v. Groetzinger, 480 U.S. 23, 35 (1987). Under
section 183(a), if an activity engaged in by an individual is not
engaged in primarily for profit, no deduction attributable to
such activity shall be allowed except to the extent allowable
under section 183(b), not relevant herein. Section 183(c)
defines an “activity not engaged in for profit” as “any activity
other than one with respect to which deductions are allowable for
the taxable year under section 162 or under paragraph (1) or (2)
of section 212.”
In determining whether an individual engages in an activity
for profit, we consider all the facts and circumstances, Golanty
v. Commissioner, 72 T.C. 411, 426 (1979), affd. without published
opinion 647 F.2d 170 (9th Cir. 1981), including the following
factors identified in section 1.183-2(b), Income Tax Regs.:
(1) Manner in which the taxpayer carries on the
activity;
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