Barry S. and Yvonne C. Hillman - Page 21

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          T.C. at 274; Sullivan v. Commissioner, T.C. Memo. 1998-367; Dodge            
          v. Commissioner, T.C. Memo. 1998-89; Taras v. Commissioner, T.C.             
          Memo. 1997-553.                                                              
               The only evidence in the record of petitioners’ horses’                 
          appreciation consists of Dr. Hillman’s self-serving,                         
          uncorroborated estimates.  No expert or other reliable evidence              
          of value was introduced.  Given that Dr. Hillman reported on his             
          1994 return that Ashley, a mare purchased 10 years earlier for               
          $2,500 that suffered chronic uterine infections and had been                 
          donated to a veterinary school with a euthanasia authorization,              
          had a fair market value of $4,800, we do not believe his                     
          estimates are entitled to significant weight.7  Even if we                   
          accepted Dr. Hillman’s value estimates, the appreciation                     
          experienced as of 1993--approximately $33,000, using his                     
          estimates--falls significantly short of petitioners’ accumulated             
          losses through 1993, which exceeded $51,000.  Losses in excess of            
          $17,000 occurred in each of the two succeeding years.                        
          Petitioners have failed to show that the appreciation in value of            
          their assets creates any inference of profit motive.                         

               7 In addition, Dr. Hillman’s asking price for Chicardo was              
          $3,500, but the horse was ultimately sold for $1,800.                        

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