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A nonexclusive list of factors set forth in section 1.183-
2(b), Income Tax Regs., guides section 183 analysis by indicating
relevant facts and circumstances for consideration: (1) Manner
in which the taxpayer carries on the activity; (2) the expertise
of the taxpayer or his advisers; (3) the time and effort expended
by the taxpayer in carrying on the activity; (4) expectation that
assets used in activity may appreciate in value; (5) the success
of the taxpayer in carrying on other similar or dissimilar
activities; (6) the taxpayer’s history of income or losses with
respect to the activity; (7) the amount of occasional profits, if
any, which are earned; (8) the financial status of the taxpayer;
and (9) elements of personal pleasure or recreation.
B. Application of the Statutory Framework
1. Manner in which the taxpayer carries on the
activity.
Petitioner claims to have drafted a business plan in 1993.
As evidence of this business plan, petitioner submitted a
business plan from a later year with the date “1993” handwritten
on the cover sheet. Petitioner testified that she deleted
portions of the submitted plan identifying two horses that did
not exist in 1993. She testified that the submitted plan, from
the beginning up to the identification of the horses, was exactly
what was written in 1993. Upon evaluation of the submitted plan,
it is clear that petitioner’s testimony that the same language
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