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Taxation Presentation

Background

Mr. Crane is a respected professor of theater and also write plays. He deducted his playwriting expenses as a Sch. C business loss. IRS disallowed the losses. IRS’s position is to deny that Mr. Crane’s playwriting is a trade or business.

Mr. Crane is an expert in theatre, is entitled to deduct the losses he incurred from his research, writing, traveling activities because he has a genuine hope, although it may have been nreasonable, of producting a profit from these activities and therefore, he is engaged in those activities form profit.

He conducted his activities in a businesslike manner as evidenced by the fact that he kept accurate records, changed his operating methods to gain wider distribution of his ….., and began receiving fees for his writing services.

Questions to consider:
• Was Mr. Crane’s playwriting an activity entered into for profit?
• If it was, did he meet his burden in substantiating each expense......

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Approximate Word Count: 820
Approximate Pages: 4 (250 words per double-spaced page)

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