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assessment of the objective factors must be informed by ‘the
insight gained from a lifetime of experience as well as an
understanding of the statutory scheme’” (quoting Nickerson v.
Commissioner, 700 F.2d 402, 407 (1983), revg. T.C. Memo. 1981-
321)), revg. T.C. Memo. 1993-536.
In Golanty v. Commissioner, 72 T.C. 411, 426 (1979), affd.
without published opinion 647 F.2d 170 (9th Cir. 1981), we
recognized that “Although no one factor is determinative of the
taxpayer's intention to make a profit * * * a record of
substantial losses over many years and the unlikelihood of
achieving a profitable operation are important factors bearing on
the taxpayer's true intention.”
The first factor considers whether the taxpayer engaged in
the activity in a businesslike manner. Sec. 1.183-2(b)(1),
Income Tax Regs. “In deciding whether the taxpayer has conducted
the activity in a businesslike manner, this Court has considered
‘whether accurate books are kept, whether the activity is
conducted in a manner similar to other comparable businesses and
whether changes have been attempted in order to make a profit.’”
Dodge v. Commissioner, T.C. Memo. 1998-89 (quoting Ballich v.
Commissioner, T.C. Memo. 1978-497), affd. without published
opinion 188 F.3d 507 (6th Cir. 1999).
In the case at hand, petitioners failed to develop a budget
or a formal or informal business plan to determine whether, and
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