- 3 -
started breeding cattle in 1979, after they began receiving
substantial royalties from an oil well that was drilled on their
land. On their 1979 through 1994 Forms 1040, petitioners
reported the following amounts from cattle breeding and oil:
Cattle breeding
Net royalties
Year Income Expenses1 Net Loss from oil
1979 $2,690 $15,299 $12,609 $157,789
1980 3,862 68,964 65,102 172,379
1981 21,606 85,028 63,422 198,030
1982 9,562 70,297 60,735 226,610
1983 4,570 89,696 85,126 167,465
1984 12,020 108,025 96,005 190,019
1985 7,522 93,003 85,481 159,237
1986 13,984 80,162 66,178 100,317
1987 21,891 95,901 74,010 112,640
1988 5,135 93,455 88,320 142,692
1989 4,234 64,955 60,721 69,933
1990 - 0 - 67,998 67,998 72,048
1991 49,320 77,835 28,515 123,622
1992 13,550 90,689 77,139 114,921
1993 46,933 87,673 40,740 97,876
1994 36,053 67,698 31,645 49,011
Total 252,932 1,256,678 1,003,746 2,154,589
1Petitioners' largest single expense was depreciation.
During the subject years, petitioners’ involvement in their
breeding activity included worming and feeding the cattle,
delivering calves, planting grass for the cattle, and maintaining
fences. Besides petitioners, the primary individuals who worked
in the breeding activity were petitioners’ two sons, Matthew and
Stephen, and their son-in-law, Kim Little. None of these helpers
received any compensation from petitioners for their help. All
of these helpers worked full-time for other employers. Stephen
and Kim also owned and operated other farms.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011