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We find that petitioner did not carry on the activity in a
businesslike manner.
5. Expertise of Taxpayer or His Advisors
“Preparation for the activity by extensive study of its
accepted business, economic, and scientific practices, or
consultation with those who are expert therein, may indicate that
the taxpayer has a profit motive where the taxpayer carries on
the activity in accordance with such practices.” Sec. 1.183-
2(b)(2), Income Tax Regs. While petitioner received free and
paid advice from individuals he considered "experts" in the
cutting horse industry, the advice did not focus on the economic
aspects of the activity. The advice which petitioner received on
profitable bloodlines and which horses to sell is consistent with
a hobbyist's motives. Taken as a whole, we find this factor to
be neutral.
6. Time and Effort
"The fact that the taxpayer devotes much of his personal
time and effort to carrying on an activity, particularly if the
activity does not have substantial personal or recreational
aspects, may indicate an intention to derive a profit.” Sec.
1.183-2(b)(3), Income Tax Regs. During 1992 and 1993, petitioner
spent 15 to 18 hours a week in connection with the Schedule F
activity. He employed a professional trainer, but he testified
that he also helped with training. Petitioner managed the
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