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Care, Nutritional Products, Personal Development and Distributor
Services”.
OPINION
A. Whether Petitioner Operated His Direct Marketing Activity
for Profit in 1997
1. Background
The issue for decision is whether petitioner operated his
direct marketing activity for profit in 1997. The parties agree
that petitioner’s undertakings as a sales representative for
various direct marketing companies are one activity.
A taxpayer conducts an activity for profit if he or she does
so with an actual and honest profit objective. Surloff v.
Commissioner, 81 T.C. 210, 233 (1983); Dreicer v. Commissioner,
78 T.C. 642, 645 (1982), affd. without opinion 702 F.2d 1205
(D.C. Cir. 1983). In deciding whether petitioner operated the
direct marketing activity for profit, we consider the following
nine factors: (1) The manner in which the taxpayer carried 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 the 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, which are
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