No Profit Motive for Sports Memorabilia Activity.

The petitioner worked full-time as a quality assurance engineer and also had an activity in which he sold sports memorabilia.  On his return for the year in issue, he filed separate Schedule Cs for his engineering business and his sports memorabilia activity.   For the sports activity, he showed no income, no costs of good sold and about $20,000 of expenses.  He had no separate bank account, no inventory system or accounting system or any books and records for the sports memorabilia activity.  The IRS disallowed the losses from the sports memorabilia activity.  The court upheld the disallowance based on the nine-factor analysis contained in Treas. Regs. Sec. 1.183-2(b).  Akey v. Comr., T.C. Memo. 2014-211