- 13 -
distances from petitioners. Such behavior suggests the absence
of a profit objective. See Bessenyey v. Commissioner, supra.
Although petitioners maintained detailed records for certain
aspects of their distributorship, the records apparently were
kept more for substantiation purposes than for use as analytical
business tools. See Theisen v. Commissioner, T.C. Memo. 1997-
539; Hart v. Commissioner, T.C. Memo. 1995-55; Poast v.
Commissioner, T.C. Memo. 1994-399.
In closing, we note that even if petitioners had maintained
their monthly point value goal of 4,000, their expenses would
still have exceeded their income from performance bonuses and
retail sales.
We are satisfied that petitioners’ primary purpose for
engaging in the sale and distribution of Amway products was
not for income or profit. After consideration of all of the
facts and circumstances, we find that petitioners’ Amway
distributorship does not fit within “a common-sense concept of
what is a trade or business.” Commissioner v. Groetzinger, 480
U.S. at 35. Therefore, petitioners are not entitled to the
deductions here in dispute, and respondent’s determination in
this regard is sustained.
Reviewed and adopted as the report of the Small Tax
Division.
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