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Case Summary

Drummond v. Commissioner

Drummond v. Commissioner, No. 16958-94, 73 T.C.M. (CCH) 1959 (T.C. 1997), aff’d in part and rev’d in part, No. 97-2106, 98-2 U.S. Tax Cas. (CCH) P.50,562 (4th Cir. 1998).


This case addressed whether a taxpayer improperly reported profits made from the sale of a drawing as self-employment income rather than long-term capital gain. Applying a seven-factor test to determine whether the drawing was held primarily for a business purpose or for investment, the court held that the profits should have been characterized as . . . .

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