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see Engdahl v. Commissioner, 72 T.C. at 669; sec. 1.183-2(b)(6),
Income Tax Regs. We have said that the startup phase of a horse-
breeding activity may be 5 to 10 years for standard bred horses.
See Engdahl v. Commissioner, supra.
Petitioners have a long history of substantial losses in their
farm and horse activity. Petitioners contend that they incurred
losses due to unforeseen circumstances such as Dr. Berry’s 2-month
illness in 1985 and the reopening of the racking horse registry in
1997. We disagree. We are not convinced that Dr. Berry’s illness
in 1985 prevented petitioners from buying broodmares in 1992, 1993,
1994, and 1995, because in those years income from his medical
practice had increased to more than $119,000, and he had additional
income from other sources. Petitioners contend that the reopening
of the racking horse registry in 1997 caused their losses in 1995.
We disagree. Petitioners have offered no evidence about the
reopening of the registry or how the reopening caused their losses
in earlier years. This factor favors respondent.
7. Amount of Occasional Profits, If Any
Small occasional profits with large continuous losses do not
indicate that the taxpayer had a profit objective. See sec. 1.183-
2(b)(7), Income Tax Regs. Petitioners had gross receipts from
selling pecans and grains, from providing stud services, and
boarding and hauling horses. The record does not indicate the
amount of expenses that were related to these activities. Even if
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