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Petitioner traveled to the dog shows with an associate in
petitioner's 1989 Fleetwood motor home. Petitioner purchased the
motor home in 1989 for $36,897. On the Schedule C included with
her 1993 return, petitioner indicated that the motor home was
used exclusively in her dog breeding business.
Petitioner also owned a 1993 Ford Bronco that was purchased
in 1992 for $36,998. On the Schedule C included with her 1993
return, she indicated that 83 percent of the usage of the Bronco
was attributable to her dog breeding activity. Petitioner used
the Bronco to commute to her job with Gross Pointe Woods, a
distance of over 30 miles from her residence.
Petitioner did not keep a separate set of books and records
for her dog breeding activity. Some of the expenses relating to
the activity were paid from a personal joint checking account
that petitioner maintained with her former husband. She also
kept copies of receipts for some of the expenses related to her
dog breeding activity. Because of complications related to her
divorce, petitioner cannot locate the relevant check registers or
any receipts.
Since 1989, only five of petitioner's dogs generated any
income. Petitioner did not maintain any records that tracked
income and expenses attributable to a particular dog. She did
not develop a business plan for the year in issue, or for any
other year. Petitioner never consulted with any professionals in
order to develop a strategy that would allow her to profit from
her dog breeding activity, nor did she alter her practices from
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Last modified: May 25, 2011