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enter into the leasing activity with the primary purpose to
profit.
Petitioner argues that we should group the equipment leasing
activity with his law practice in determining whether there was a
profit motive. Alternatively, petitioner argues that, if we do
not group the activities, he engaged in the leasing activity for
profit. Respondent counters that the leasing activity and the
law practice cannot be grouped because they are separate
activities, and that the leasing activity was not an activity
engaged in for profit.
A. Whether Petitioner’s Law Practice and His Leasing
Activity May Be Grouped for Purposes of Section 183
A taxpayer’s various activities may be viewed as a single
activity if they are sufficiently interconnected. See sec.
1.183-1(d)(1), Income Tax Regs. We look to the organizational
and economic interrelationship of the activities, their business
purpose, and their overall similarity in determining whether they
may be viewed collectively. Id. Further, the Commissioner will
generally accept a taxpayer’s characterization of his or her
various undertakings as one activity unless it appears that the
characterization is artificial and unsupported by the facts. Id.
Section 183 applies, however, only to individuals and S
corporations. See sec. 1.183-1(a), Income Tax Regs. (extending
section 183 application to trusts and estates because they are
taxed as individuals). Further, the section 183 regulations
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