Leroy Loser's return has been examined and the IRS has disallowed losses claimed in his chinchilla...
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Leroy Loser's return has been examined and the IRS has disallowed losses claimed in his chinchilla farm operation as an activity not entered into for profit. Leroy wants you to appeal the Revenue Agent's determi- nation. He explains to you that his intention in entering into the venture was to make a profit and that it was only bad luck and poor economic conditions that caused him to show a loss for the last six years. During the entire six-year period, Leroy was also a highly paid consultant to a nationwide engineering firm. (A) Should Leroy attend the conference with the Appeals Officer "to help establish the profit motive?" (B) If not, how else can he "prove" his profit motive? Leroy Loser's return has been examined and the IRS has disallowed losses claimed in his chinchilla farm operation as an activity not entered into for profit. Leroy wants you to appeal the Revenue Agent's determi- nation. He explains to you that his intention in entering into the venture was to make a profit and that it was only bad luck and poor economic conditions that caused him to show a loss for the last six years. During the entire six-year period, Leroy was also a highly paid consultant to a nationwide engineering firm. (A) Should Leroy attend the conference with the Appeals Officer "to help establish the profit motive?" (B) If not, how else can he "prove" his profit motive?
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A Leroy should not attend the conference with the Appeals Officer to help establish the profi... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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