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iii. Time and Effort Spent Conducting the Activity
The fact that a taxpayer devotes much of his or her personal
time to an activity may indicate a profit intent, especially
where the activity does not involve substantial personal or
recreational aspects. Also, a taxpayer’s withdrawal from another
occupation to devote his or her time and effort to an activity
may indicate a profit motive. Burleson v. Commissioner, T.C.
Memo. 1983-570; sec. 1.183-2(b)(3), Income Tax Regs.
Petitioners argue that this factor weighs in their favor.
We disagree. Although petitioners devoted their time to the
activity during the tournaments, they spent only approximately 3
months of the year on that activity. Moreover, not all of that
time was devoted to the fishing activity. The record reveals
that contestants at the tournaments spent much of their time
frolicking and reveling with family and friends, and we are
unable to find in the record credible evidence that would
indicate that such was not the case with petitioners. We also
note that Mr. Peacock’s stated reason for leaving the automobile
industry in 1993 was to spend more time with his wife rather than
to devote his time to another business. This factor is neutral.
iv. Expectation That Assets Will Appreciate in Value
“Profit” encompasses appreciation in the value of assets.
Sec. 1.183-2(b)(4), Income Tax Regs. Therefore, in evaluating a
taxpayer’s intent, we also look to the taxpayer’s expectation
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