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were in California. Petitioner presented no evidence that she
was aware of the state of the market or other factors that may
affect profitability. “While a formal market study is not
required, a basic investigation of the factors that would affect
profit is.” Burger v. Commissioner, supra; see also Golanty v.
Commissioner, supra at 432; Wesinger v. Commissioner, T.C. Memo.
1999-372.
Petitioner testified that she discussed aspects of her horse
activity with two C.P.A.s, Ms. Pope and Mr. Wessman, which their
testimony corroborated. However, it is unclear whether they
discussed anything more than petitioner’s expenses in preparing
the annual profit and loss statements and Schedules C. While Ms.
Pope and Mr. Wessman may have expertise in accounting, neither
testified to having experience in running a profitable horse-
breeding business. Since 1988, petitioner has not consulted with
experts regarding the economic aspects of running a profitable
horse-breeding business. Considering petitioner’s long history
of losses, this is not indicative of a profit motive. See
Golanty v. Commissioner, supra at 432; Wesinger v. Commissioner,
supra; Hillman v. Commissioner, T.C. Memo. 1999-255; Dodge v.
Commissioner, T.C. Memo. 1998-89.
None of petitioner’s reference materials and publications
were devoted to the business aspects of horse breeding.
Petitioner testified that only one of the references in her
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