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and art shows during the years at issue. We note, however, that
in a detailed calendar for 2001, which was submitted as an
exhibit and on which petitioners testified that they recorded all
of the time spent on training, marketing, and sales, there is not
one entry of any craft or arts show. There are also no entries
showing preparation for any craft or arts shows.
Although petitioners reported sales of $855 in 2001, there
is no evidence that petitioners actually made any sales in 2001
or to whom these sales were made.
Petitioners did not use a separate bank account or telephone
number for their activity, and the insurance held on all of their
photography equipment was incorporated into their homeowner’s
policy.
Mr. Storer testified that, as one example of the “highly
professional nature in which he carried on his business,” he only
used business cards printed by a commercial printer rather than
the type printed on an ink-jet printer “with those little
perforations on the sides.” Upon examination of the two business
cards provided by petitioners with their exhibits, however, it is
clear that the cards have both the visible dot-matrix quality
akin to those printed on an ink-jet printer as well as perforated
edges.
Although petitioners kept very extensive and detailed
records of their expenses, we believe that these records were
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