Anke Lunsmann-Nolting - Page 8

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          advisers; (3) the time and effort expended by the taxpayer; (4)             
          expectation that assets used in activity may appreciate in value;           
          (5) the success of the taxpayer in carrying on 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.  No single factor is determinative.  Sec. 1.183-2(b),           
          Income Tax Regs.                                                            
               Lot Nos. 128A and 129                                                  
               In 2002, the cottages on lot Nos. 128A and 129 had been                
          uninhabitable for several years, and petitioner had no                      
          expectation of renting either cottage.  Therefore, petitioner was           
          not holding lot Nos. 128A and 129 in connection with any activity           
          for profit.                                                                 
               Petitioner claimed for lot Nos. 128A and 129 cleaning and              
          maintenance costs and taxes on Schedule E.  Generally, no                   
          deduction is allowed for personal, living, or family expenses.              
          Sec. 262(a).  Accordingly, petitioner is not entitled to claim a            
          deduction for cleaning and maintenance costs.                               
               State and local real property taxes, however, are allowed as           
          a deduction for the taxable year within which they were paid.               
          Sec. 164(a)(1).  Section 164(a)(1) allows the owner of property a           
          deduction for real property taxes regardless of whether they were           
          paid or incurred in a trade or business.  See sec. 183(b)(1);               




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