A court rules that a taxpayer wasn’t in the business of flipping houses, so he couldn’t deduct expenses.
The U.S. Tax Court has determined that a taxpayer who decided to flip houses with a group of friends and obtained his real estate license wasn’t entitled to mileage deductions for taking the group to see properties.
The court found that the taxpayer’s real estate activity didn’t rise to the level of a trade or business because the group never actually bought any properties and the taxpayer never earned any real estate commissions.
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