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recreational aspects. Sullivan v. Commissioner, T.C. Memo. 1998-
367, affd. without published opinion 202 F.3d 264 (5th Cir.
1999).
Mrs. Cooper testified that she participated in horse shows
on holidays and every weekend, sometimes twice in one weekend.
Keeping and showing horses has strong recreational aspects,
especially given her long-term interest in horses. Although the
Court believes that Mrs. Cooper spent considerable time with her
horses, the Court finds that this factor is not dispositive.
Factor (4): The Expectation That Assets Used in the
Activity May Appreciate in Value
An expectation that assets used in the activity will
appreciate in value may indicate a profit objective. Sec. 1.183-
2(b)(4), Income Tax Regs. Mrs. Cooper briefly testified about a
horse, “Scooter”, she believed to be valued at $35,000 based on
training and winnings earned. During her subsequent testimony,
Mrs. Cooper stated that Scooter actually belongs to her mother.
She testified about two other horses but merely speculated about
their value.
Factor (5): The Success of the Taxpayer in Carrying On
Similar or Dissimilar Activities
A taxpayer’s past successes in similar or dissimilar
activities is relevant in determining a profit objective. Sec.
1.183-2(b)(5), Income Tax Regs. During 2001, Mrs. Cooper also
had a dog-breeding business which generated gross receipts of
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