- 17 - Commissioner, 339 F.2d 377, 380 (2d Cir. 1964), affg. T.C. Memo. 1964-2; Dreicer v. Commissioner, 78 T.C. 642, 645 (1982), affd. without opinion 702 F.2d 1205 (D.C. Cir. 1983); Jasionowski v. Commissioner, 66 T.C. 312, 319 (1976); sec. 1.183-2(a), Income Tax Regs. Although a taxpayer’s expectation of profit need not be reasonable, there must be a good faith objective of making a profit. See Dreicer v. Commissioner, supra. There is no evidence in the record that any of the properties listed in the 1988 return has ever generated a profit, or that petitioner expected that they would ever become profitable, either individually or as a group. To the contrary, petitioner, on brief, indicates that he never believed that his rental properties would become profitable. For example, in defense of his nonpayment of estimated taxes for the audit year, petitioner states in his opening brief: Petitioner cannot be held liable for failing to file an estimated tax return because the Petitioner did not owe any taxes and has never owed any taxes to the Internal Revenue Service in the more than 50 years he has been filing income taxes. The deductions Petitioner has used for this tax year and all other tax years have always [been] in excess of the income he has earned and therefore Petitioner * * * had not [sic] duty to file any estimated income tax. [Emphasis added.] Similarly, in his reply brief, petitioner states: There was not [sic] need to pay estimated tax since I have never owed the IRS an estimated tax in 20 years of practicing law and renting properties.Page: Previous 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Next
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