John R. and Edith M. Garbini - Page 10

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               We next consider the success of the taxpayer in carrying on            
          other similar or dissimilar activities.  Prior to purchasing the            
          ranch, petitioner said he purchased undeveloped land in San Jose,           
          California, and developed “the first luxury mobile home park for            
          senior citizens in the state”.  Petitioners owned and operated              
          the mobile home park for approximately 20 years.  Petitioner                
          stated that petitioners worked 7 days per week and employed one             
          groundsman.  Petitioner further stated that the mobile home park            
          operated profitably after the first 10 years and that 10 years              
          thereafter, petitioners sold the mobile home park for $7 million.           
               The taxpayer’s history of income or losses with respect to             
          the activity is another factor.  At trial, petitioner did not               
          provide a history of income or losses for his ranch.  During the            
          taxable years in issue, losses exceeded $250,000, an average of             
          $125,000 for each year.  Although petitioner claimed that the               
          losses since 1997 have lessened, petitioner admitted that the               
          losses for the years before those in issue would have been                  
          roughly the same as the taxable years in issue.  Over this                  
          approximate time frame of 12 years, petitioner incurred losses of           
               The amount of occasional profits, if any, which are earned             
          is another factor.  No profits were earned with respect to the              
          ranch during the years in issue.                                            
               We next consider the financial status of the taxpayer.                 

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