- 8 -
v. Commissioner, supra at 645; sec. 1.183-2(a), Income Tax Regs.
Whether a taxpayer has an actual and honest profit objective is a
question of fact to be answered from all the relevant facts and
circumstances. Hulter v. Commissioner, supra at 393; Hastings v.
Commissioner, supra; sec. 1.183-2(a), Income Tax Regs. Greater
weight is given to objective facts than to a taxpayer’s mere
statement of intent. Dreicer v. Commissioner, supra at 645; sec.
1.183-2(a), Income Tax Regs. The taxpayer bears the burden of
establishing he or she had the requisite profit objective.8 Rule
142(a); Keanini v. Commissioner, 94 T.C. 41, 46 (1990); Hastings
v. Commissioner, supra.
The regulations set forth a nonexhaustive list of factors
that may be considered in deciding whether a profit objective
exists. These factors are: (1) The manner in which the taxpayer
carries on the activity; (2) the expertise of the taxpayer or his
advisers; (3) the time and effort expended by the taxpayer in
8 Generally, and aside from sec. 183-related issues, the
Commissioner’s determinations are presumed correct, and the
taxpayer bears the burden of proving those determinations wrong.
Rule 142(a); INDOPCO, Inc. v. Commissioner, 503 U.S. 79, 84
(1992); Welch v. Helvering, 290 U.S. 111, 115 (1933). Under sec.
7491, the burden of proof may shift from the taxpayer to the
Commissioner if the taxpayer produces credible evidence with
respect to any factual issue relevant to ascertaining the
taxpayer’s tax liability. Sec. 7491(a)(1). In this case there
is no such shift because petitioner neither alleged that sec.
7491 was applicable nor established that she fully complied with
the requirements of sec. 7491(a)(2). The burden of proof remains
on petitioner. Compare sec. 183(d), which is inapplicable to the
instant case because its conditions have not been satisfied.
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