Problem
Goggle, who owns a successful high-tech start-up business, develops an interest in winemaking. Goggle purchases land in neighboring wine country and buy a home and land surrounding it and grow grapes on the land. Regrettably, Goggle's grape-growing endeavors are not as successful as the high-tech endeavors. Goggle has net losses in each of the first two years of grape-growing operations. In the third year, Goggle earns $55,000 from sales of grapes, but Goggle also incurs $10,000 of property taxes, $15,000 of interest on a mortgage on the property, $20,000 of salaries, $20,000 in other operating expenses, and $15,000 of depreciation. Discuss the deductibihty of Goggle's expenses under 183 in year three.