- 5 - maintenance of Daisy in the amount of $7,714.07. Included in this amount are the following expenditures: Expenditures Explanation $4,583.00 - stud fee; boarding and care for Daisy; and boarding & care of Sassy during pregnancy. 3,131.07 - costs to maintain horses, plus a moving expense. In February of 1990, petitioners sold Daisy for $1,400. Daisy was sold at the approximate age of 22 months. A dressage horse reaches its peak value between age 12 and 14, and only after extensive training. Petitioners did not provide any training to Daisy between her birth in 1988 and sale in 1990, nor did they enter Daisy in any dressage competitions prior to sale. Petitioner testified that personal, family matters precluded her from spending the time with Daisy that would have been necessary to train the horse for dressage riding. OPINION Petitioners claim that they incurred a loss on the sale of Daisy and that, pursuant to section 165(c)(2), they are entitled to deduct the loss as a long-term capital loss. In calculating the amount of the long-term capital loss petitioners computed their cost basis in Daisy by taking into account all of the expenditures incurred in connection with Daisy's care. Respondent offers a variety of reasons why petitioners are not entitled to the deduction here in dispute.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 Next
Last modified: May 25, 2011