- 16 -
breeders, Mr. Tom Regal and Mr. Paul Mills. Petitioners sought
and received professional training and breeding advice.
Time Devoted to the Activity
The fact that a taxpayer devotes much of his personal time
and effort to carrying on an activity may indicate an intention
to derive a profit. Sec. 1.183-2(b)(3), Income Tax Regs.
Petitioners contend that they personally devoted a
substantial amount of time to the activity. Ms. Taras testified
that she spent approximately 30 hours per week on projects
related to the activity, including: Bookkeeping, feeding the
horses, cleaning the stalls, and exercising the horses. Mr.
Taras testified that during the years at issue, he spent
approximately 39 to 45 hours per week taking care of the horses,
feeding and exercising the horses, and performing routine
veterinary services.
During the period in which petitioners each claim they spent
a large number of hours on their horse activity, they also
participated in other time-demanding activities. Mr. Taras has
owned and managed a framing and truss fabrication business in
which he employed and managed between 5 and 10 persons to help
him do on-site framing of homes and fabrication of trusses while
he claimed to have worked approximately 40 or more hours per week
on petitioners' racehorse activity. Similarly, Ms. Taras worked
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011