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Respondent determined deficiencies in petitioners’ Federal
income taxes in the amount of $6,178 for 1999 and $7,940 for
2000. The issue for decision is whether petitioners engaged in
their Amway/Quixtar activity during 1999 and 2000 with the
objective of making a profit within the meaning of section 183.
Background
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. When they filed their
petition, petitioners resided in St. Charles, Illinois.
Petitioners filed joint Federal income tax returns for 1999
and 2000. At all relevant times, petitioner Randall Ollett
(petitioner) was employed as a computer data security manager by
the American Medical Association in Chicago, Illinois. He
typically worked at this employment between 45 and 50 hours each
week and spent an additional 12 to 20 hours each week commuting
to and from work. Petitioner Kay Ollett (Mrs. Ollett) worked
approximately 30 hours each week as a preschool teacher at
Evangelical Covenant Church. Petitioners reported combined wages
of $96,389 in 1999 and $98,949 in 2000.
Petitioner graduated from Princeton University with a
bachelor of science degree in electrical engineering, and he has
a master’s degree in business administration from Lamar
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