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all 19 horses by using what petitioner Charles F. Patterson
considered to be the horses' combined fair market values on that
date. Petitioners have stipulated that they have not provided
any substantiation as to the cost of any of the horses which they
acquired prior to 1988. Petitioners also acquired a 20th horse
during 1988 and used the horse's purported cost as its
depreciable basis. Petitioners have stipulated that they have
not supplied any substantiation as to the cost or acquisition
date of this horse.
With respect to the business equipment, machinery and
equipment, nonlisted vehicles, office furnishings, and library
materials placed in service on January 1, 1988, petitioner
calculated depreciable bases from his estimate of the fair market
values of the assets on that date. With respect to the computer
and peripherals placed in service on January 1, 1988, petitioner
calculated depreciable bases from the purported cost of the items
in question. Petitioners have stipulated that they have not
provided any substantiation as to the acquisition dates or cost
of the specific items of business equipment, computer and
peripherals, machinery and equipment, nonlisted vehicles, office
furnishings, and library materials.
Petitioners placed three horses, Moonsang, Since Gussie, and
Puget Sound, in service on January 1, 1990. Petitioner listed
cost bases attributable to the horses in the amounts of $400,
$700, and $800, respectively. In addition, petitioner added a
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