Michael G. Bunney - Page 12

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          factors are:  (1) The 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) the expectation that assets used in the                   
          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 loss with respect to the                    
          activity; (7) the amount of occasional profits, if any, that are            
          earned; (8) the financial status of the taxpayer; and                       
          (9) elements of personal pleasure or recreation.  These factors             
          are not intended to be exclusive, and no one factor or majority             
          of the factors need be considered determinative.  Golanty v.                
          Commissioner, supra at 426-427; sec. 1.183-2(b), Income Tax Regs.           
          In this case, the predominant factors weighing against petitioner           
          are whether petitioner carried on the activity in a businesslike            
          manner, petitioner’s history of losses, and the elements of                 
          personal pleasure involved.  None of the other factors supports             
          his position.                                                               
               Petitioner argues that he conducted his horse activity in a            
          businesslike manner.  Maintaining complete and accurate books and           
          records, conducting the activity in a manner substantially                  
          similar to comparable businesses that are profitable, and making            
          changes in operations to adopt new techniques or abandon                    
          unprofitable methods are factors that may indicate that a                   

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