Victor A. and Marion W. Prieto - Page 13




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               H.   Personal Nature of Activity/Elements of Pleasure                  
               During the years in issue, petitioners and their children              
          spent almost every weekend with the horses.  Dr. Prieto, Mrs.               
          Prieto, Jill, and Claire used the weekends spent with the horses            
          as their time to unwind.  Jill and Claire would ride and take               
          lessons on the horses.  Jill and Claire enjoyed riding horses.              
          Mrs. Prieto also rode the horses.  In addition to watching their            
          daughters compete at the horse shows, petitioners attended                  
          hospitality tents located at the horse shows.                               
               In January 1994, petitioners sold a horse named “Browning”.            
          In a letter thanking the purchaser of Browning for buying the               
          horse, petitioners wrote that they would be using the money from            
          this transaction to purchase a quality junior jumper for their              
          daughter Jill.                                                              
               Dr. Prieto only did “simple” tasks for the horse activity.             
          He felt that his college and medical education entitled him not             
          to muck4 the stalls.                                                        
               During the years in issue, Mrs. Prieto, Claire, and Jill               
          were members of the following horse organizations:  The American            
          Horse Shows Association, the Pacific Horse Show Association, the            
          California Professional Horsemen’s Association, the United States           
          Equestrian Team, and the NorCal Hunter Jumper Association.  In              



               4  To “muck” means “to clear of manure or filth”.  Merriam             
          Webster’s Collegiate Dictionary 762 (10th ed. 1996).                        





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