- 12 - and effort in pursuit of this activity. This factor favors petitioner. A profit objective is strongly indicated where the taxpayer has experienced a series of profitable years. Sec. 1.183- 2(b)(6), Income Tax Regs. Detailed financial information about petitioner’s other taxable years is not available on this record. An opportunity to earn a substantial ultimate profit in a highly speculative venture is ordinarily sufficient to indicate that the activity is engaged in for profit even though losses or only occasional small profits are actually generated. Sec. 1.183- 2(b)(7), Income Tax Regs. Although it was modest in amount, petitioner enjoyed a profit from gambling during the year in issue. This factor is neutral or slightly favors petitioner. The next factor significant in our inquiry is the financial status of the taxpayer. A profit objective might be indicated where the taxpayer does not have substantial income from sources other than the activity. Sec. 1.183-2(b)(8), Income Tax Regs. Petitioner held no substantial investments during 2001, and his part-time employment as a delivery truck driver was his only other source of income. Under the circumstances, the amount of his wages gives little insight into his profit objective. On balance, we consider this factor to be neutral. A lack of profit objective might be indicated where there are personal motives for carrying on the activity, especiallyPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
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