- 8 - Petitioner also failed to develop a budget or a business plan for any of her activities. Although budgets and business plans are not required, a lack of information upon which to make educated business decisions tends to belie a taxpayer’s contentions that an activity was pursued with the objective of making a profit. Dodge v. Commissioner, T.C. Memo. 1998-89, affd. without published opinion 188 F.3d 507 (6th Cir. 1999). A taxpayer’s history of income or losses with respect to the activity can also indicate whether a profit objective was present. Sec. 1.183-2(b)(6), Income Tax Regs. Here, petitioner reported only losses from the activities and never made a profit from any of them. Using the same analytic framework set out in the regulations, it is clear that the Lila Osborne Memorial building was not held with a profit objective; petitioner did not charge admission, nor did she charge her brothers rent for their use of space in the building. She had no tenants. Only two of the rooms were used for activities that might generate income. Similarly, it is clear that the free reading room and free spiritual counseling were offered to the public with no profit objective. Therefore, we focus the rest of our discussion on the mortgage and reflexology services offered by petitioner.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 NextLast modified: March 27, 2008