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reasonable, there must be a good faith objective of making a
profit. Allen v. Commissioner, 72 T.C. 28, 33 (1979); sec.
1.183-2(a), Income Tax Regs. We give greater weight to objective
facts than to a taxpayer’s statements of intent. Dreicer v.
Commissioner, supra at 645; sec. 1.183-2(a), Income Tax Regs.
Before we address whether petitioners had the primary,
predominant or principal purpose of realizing an economic profit
independent of tax savings, we first must address whether CFI and
BHJ may be treated as one activity. Respondent argues that we
may not aggregate the two activities to determine the profit
objective. We agree.
B. Whether CFI and BHJ May Be Treated as One Activity for
Purposes of Section 183
Multiple activities of a taxpayer may be treated as one
activity if the activities are sufficiently interconnected. Sec.
1.183-1(d)(1), Income Tax Regs. In making this determination,
the most important factors to be considered include the degree of
organizational and economic interrelationship of the
undertakings, the business purpose served by carrying on the
undertakings separately or together, and the similarity of the
undertakings. Id. The Commissioner generally accepts a
taxpayer’s characterization of two or more undertakings as one
activity unless the characterization is artificial or
unreasonable. Id.
We have considered those and other factors in determining
whether the taxpayer’s characterization is unreasonable. These
include: (a) Whether the undertakings share a close
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