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opinion 647 F.2d 170 (9th Cir. 1981).
Based on all of the facts and circumstances in the present
case, we hold that petitioner has failed to prove that she
engaged in the horse breeding activity for profit within the
meaning of section 183. See Rule 142(a); INDOPCO, Inc. v.
Commissioner, supra; Welch v. Helvering, supra.
We do not analyze in depth all nine of the factors
enumerated in the regulation but rather focus on some of the more
important ones that inform our decision.
The fact that a taxpayer carries on the activity in a
businesslike manner and maintains complete and accurate books and
records may indicate a profit objective. Sec. 1.183-2(b)(1),
Income Tax Regs. However, petitioner failed to develop a budget
or a formal or informal business plan to determine whether the
horse breeding activity could be operated profitably. Other than
canceled checks and a few receipts, petitioner also failed to
keep any books and records with respect to the horse breeding
activity. Petitioner did not keep the type of records that could
be used to increase the profitability of a business. Petitioner
never prepared budgets or market projections that would outline
strategies for ensuring a profitable business venture and making
informed business decisions on a periodic basis. Such lack of
information upon which to make educated business decisions tends
to belie a taxpayer’s contentions that an activity was pursued
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