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related activities. Expertise regarding breeding and competition
is not inconsistent with the pursuit of cutting horse activities
as a hobby, and we thus do not attach great significance to Mrs.
Sullivan's knowledge and experience in these areas in deciding
whether a profit motive can be inferred.
Petitioners’ apparent inability to provide all of the
training necessary for their horses to perform as cutting horses
is also relevant. As previously discussed, whereas the two
profitable cutting horse professionals who testified at trial
both engaged in extensive training of cutting horses for
compensation, petitioners did not do so. We believe the lack of
this expertise figured prominently in their history of losses.
Time and Effort Expended
The fact that the taxpayer devotes much of his or her
personal time and effort to carrying on an activity, particularly
if the activity does not have substantial recreational aspects,
may indicate a profit motive. Sec. 1.183-2(b)(3), Income Tax
Regs. In 1992 Mrs. Sullivan was predominantly involved in
petitioners' horse-related activities, as Mr. Sullivan spent 80
to 100 hours per week working at his business. Petitioners place
considerable emphasis on the hours devoted by Mrs. Sullivan and
argue that the onerous manual labor performed by her in caring
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