Charlie Daniel Turner, Jr. and Sandra Lovell Turner - Page 11




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          reasons, we agree with respondent.                                          
               The term “trade or business” is not precisely defined in the           
          Internal Revenue Code or the regulations promulgated thereunder;            
          however, it is well established that in order for an activity to            
          be considered a taxpayer’s trade or business for purposes                   
          relevant here, the activity must be conducted “with continuity              
          and regularity” and “the taxpayer’s primary purpose for engaging            
          in the activity must be for income or profit.”  Commissioner v.             
          Groetzinger, 480 U.S. 23, 35 (1987).  After careful                         
          consideration, we are not persuaded that petitioner’s primary               
          purpose for engaging in Turtle Performance was for income or                
          profit.                                                                     
               The test of whether a taxpayer conducted an activity for               
          profit is whether he or she entered into, or continued, the                 
          activity with the actual or honest objective of making a profit.            
          See Keanini v. Commissioner, 94 T.C. 41, 46 (1990); Dreicer v.              
          Commissioner, 78 T.C. 642, 644-645 (1982), affd. without                    


               6(...continued)                                                        
                    (c) Activity Not Engaged In For Profit Defined.–-For              
               purposes of this section, the term “activity not engaged in            
               for profit” means any activity other than one with respect             
               to which deductions are allowable for the taxable year under           
               section 162 or under paragraph (1) or (2) of section 212.              
          We note that for years 1995 and 1996 income reported on the                 
          Schedules C actually includes employee business expense                     
          reimbursements improperly characterized as income from Turtle               
          Performance.                                                                






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