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failure to do what a reasonable and ordinarily prudent person
would do under like circumstances. Neely v. Commissioner, 85
T.C. 934 (1985). The term "negligence" includes any failure to
make a reasonable attempt to comply with the provisions of the
internal revenue laws, and the term "disregard" includes any
careless, reckless, or intentional disregard of rules or
regulations.
The Court is satisfied that petitioner not only engaged in
the horse breeding activity solely because of her personal love
of horses but also engaged in this activity with the knowledge
that it was unrealistic to expect that any profit could be
realized in the manner in which she conducted the activity. Such
a conclusion is manifested by the fact that petitioner maintained
no books and records, commingled the meager income with her
personal funds, and never sought the advice of professionals who
could have advised her on what she should do to make the activity
profitable. Petitioner, moreover, had a degree in business and
obviously had some knowledge, albeit basic, that her activity, as
described, necessitated the maintenance of books and records.
The substantial losses petitioner claimed over the years from
this activity and the manner in which she conducted this activity
manifest a negligent or intentional disregard of rules or
regulations. Respondent's determination on this issue also was
based on the deficiency attributable to the disallowed
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