Randall B. and Kay F. Ollett - Page 12

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          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 losses with respect to the                  
          activity; (7) the amount of occasional profits, if any, which are           
          earned; (8) the financial status of the taxpayer; and (9)                   
          elements of personal pleasure or recreation.  Sec. 1.183-2(b),              
          Income Tax Regs.                                                            
               No single factor, nor the existence of even a majority of              
          the factors, is controlling, but rather it is an evaluation of              
          all the facts and circumstances in the case, taken as a whole,              
          that is determinative.  Golanty v. Commissioner, 72 T.C. 411,               
          426-27 (1979), affd. without published opinion 647 F.2d 170 (9th            
          Cir. 1981); sec. 1.183-2(b), Income Tax Regs.                               
               After careful consideration of all facts and circumstances             
          presented in this case, we conclude that petitioners did not have           
          an actual and honest objective of making a profit from their                
          Amway distributorship.                                                      
               Petitioners did not have any sales experience prior to                 
          becoming Amway distributors.  Petitioners relied exclusively on             
          their upline distributors, who stood to benefit from petitioners’           
          participation, for advice and training.  They did not seek                  
          independent business advice at the beginning of their Amway                 






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