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that she did not conduct her thoroughbred horse breeding and
racing activities in a businesslike manner.
2. The Expertise of the Taxpayers or Their Advisers
We next consider petitioner’s expertise or the expertise of
her advisers in her thoroughbred horse breeding and racing
activities. Efforts to gain experience and a willingness to
follow expert advice are considered in deciding whether a
taxpayer has a profit objective. Sec. 1.183-2(b)(2), Income Tax
Regs. Preparing for an activity by consulting with experts may
indicate that a taxpayer has a profit motive if the taxpayer
follows that advice. Id.
Petitioner asserts, and we agree, that both she and her
advisers possess the requisite expertise in thoroughbred horse
breeding and racing to indicate a profit motive. She herself has
been involved with different aspects of the thoroughbred horse
industry since the late 1960s, and she has been involved in her
current capacity as an owner in the industry since the early
1980s.
Further, her advisers are experts in thoroughbred horse
breeding and racing as well. Her breeding manager, McMahon, owns
and operates a thoroughbred horse farm that produced Funny Cide,
who won both the Kentucky Derby and the Preakness in the same
year. Petitioner also employed professional trainers all over
the country, and her CPA has handled the books for her
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