- 14 - (B), Temporary Income Tax Regs., 53 Fed. Reg. 5702 (Feb. 25, 1988), do not apply in the instant case. We now turn to the extraordinary services exception under section 1.469-1T(e)(3)(ii)(C), Temporary Income Tax Regs., 53 Fed. Reg. 5702 (Feb. 25, 1988). Respondent asserts that petitioners did not provide extraordinary personal services in their sailboat charter business. Petitioners, however, contend that they provided extraordinary personal services by, for example, updating Moonshadow’s web page on AYC’s internet site, searching for and acquiring proper repair parts, performing installations, repairs (e.g., repair of windlass) and routine maintenance, and using an outstanding full-service charter broker to facilitate the check-in and embarkation process. Petitioners argue that performing extensive work on Moonshadow to keep it in pristine condition constitutes exceptional personal services. The personal services provided by petitioners in conjunction with AYC’s services clearly contributed to maintaining Moonshadow’s immaculate condition and to its marketability to prospective charterers. Such services, however, are not those ordinarily contemplated under the extraordinary personal services exception. In other words, for that exception to be applicable, the use by customers of the sailboat would have to be incidental to the receipt of petitioners’ personal services.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Next
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