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and care of his horses. When the record is considered in the
aggregate, we find that this factor weighs in favor of
petitioner.
Second, preparation for the start of an activity through
extensive study of its accepted business, economic, and
scientific practices, or consultation with those who are experts
therein, indicates that a taxpayer has entered into an activity
for a profit. Id. at 668; Pederson v. Commissioner, T.C. Memo.
1994-555; sec. 1.183-2(b)(2), Income Tax Regs. Petitioner went
to great lengths to develop a degree of expertise involving
horses. By the time petitioner graduated from college in 1977,
he had received a horse trainer's license in five States.
Petitioner further testified that following a brief period during
which he was not involved with horses, he spent 2 years studying
the characteristics of successful racehorses. Petitioner studied
pedigree charts and read numerous trade periodicals. Petitioner
also testified that he spent a significant amount of time at a
racetrack studying the performance of various horses. This 2-
year period of study culminated in 1982 when petitioner purchased
his first horse.
Petitioner also called a former general manager of the
Maryland Horse Breeders Association as a witness. This witness
testified that petitioner spent an extraordinary amount of time
studying pedigrees and conducting other research in a library
maintained by the Maryland Horse Breeders Association.
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