David M. and Teri L. Saykally - Page 27

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               There is no evidence in the record, not even petitioner’s               
          testimony, that he intended to engage in a business of his own               
          with the developed technology.  “The fact that a taxpayer may                
          have taken an active role in directing the research does not, by             
          itself, place a taxpayer in a trade or business.”  I-Tech R&D                
          Ltd. Pship. v. Commissioner, T.C. Memo. 2001-10 (citing Green v.             
          Commissioner, 83 T.C. at 690).  There is no evidence in the                  
          record of any specific plans or forecasts relating to the                    
          probability that petitioner might engage in the marketing of the             
          developed technology.  Id.  There is no evidence that petitioner             
          actually marketed the developed technology.  Indeed, it would                
          have been counterintuitive for petitioner to market the developed            
          technology to outsiders; CPSG, Inc. was already an established               
          software marketing entity with existing customers.  All the                  
          publications and marketing materials relating to the developed               
          technology were created on behalf of CPSG, Inc., not petitioner.             
          If petitioner himself marketed the developed technology, he would            
          be competing with his solely owned corporation.  Indeed on brief,            
          petitioners argued “CPSG was in absolutely the best position in              
          the universe to market the * * * [Developed Technology].  Not                
          only was it reasonable for petitioner to attempt to use CPSG to              
          market the new products, it would have been asinine for him not              
          to have done so.”                                                            







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