DKD Enterprises, et al. v. Comr., T.C. Memo. 2011-29

(taxpayer's information technology consulting company (conducted in her home in West Des Moines, Iowa) determined to not be a qualified personal service corporation, and taxpayer's cat breeding activity not conducted as a trade or business resulting in non-deductible expenses; court made numerous other findings:  taxpayer's business cannot deduct under I.R.C. Sec. 162(a) amounts related to cat-breeding activity that were treated as reimbursements to taxpayer and her personal partner as well as amounts paid for taxes and licenses, and such amounts must be included in gross income as constructive dividends; taxpayer cannot deduct amounts for home mortgage interest and real estate taxes; taxpayer's corporation cannot deduct amounts paid into investment fund maintained for the business; no deduction allowed for premium amounts paid on account of health insurance policy purchased for taxpayer).