Nora E. Keating and Richard L. Shearer - Page 2




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                                   Joint          Nora Keating’s                      
                    Year           Deficiency     Deficiency                          
                    1996           $7,784                                             
                    1997           6,507                                              
                    1998           18,181                                             
                    1999           16,191                                             
                    2000           20,219                                             
                    2001                          $29,066                             
                    2002                          35,815                              

               Unless otherwise indicated, all section references are to              
          the Internal Revenue Code in effect for the years in issue, and             
          all Rule references are to the Tax Court Rules of Practice and              
          Procedure.                                                                  
               All references to petitioner in the singular are to                    
          petitioner Nora Keating.                                                    
               The issue for decision is whether petitioner’s Arabian                 
          horse-breeding activity (horse activity) constituted an activity            
          carried on for profit under section 183.                                    

                                  FINDINGS OF FACT                                    
               Some of the facts have been stipulated and are so found.               
               At the time of filing the petition, petitioners resided in             
          Williston, North Dakota.                                                    
               In 1996, petitioner moved to Williston, North Dakota, began            
          work as an emergency room physician in a local hospital, and                
          purchased a home on a 10-acre farm.                                         
               Throughout the years in issue, petitioner worked                       
          approximately 60 hours a week as a physician--typically two 24-             






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Last modified: November 10, 2007