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limited to word of mouth, participation in shows, placement of
advertisements on three Web sites, and posting of notices at a
saddle shop. During the years in issue, petitioner did not
advertise in any trade magazines, journals, or written
publications.
The commingling of personal and activity funds is not
indicative of businesslike practices. Burrow v. Commissioner,
supra; Ballich v. Commissioner, T.C. Memo. 1978-497. As
indicated, petitioner did not have a separate bank account for
her horse activity but instead paid horse-related and personal
expenses out of several personal accounts.
With regard to changes in operating methods, small
improvements over several years may not reflect a businesslike
operation. Wesinger v. Commissioner, supra. The various changes
to petitioner’s horse activity appear to us to have been
relatively insignificant.
While construction of barns and other facilities may
demonstrate a profit objective, Strickland v. Commissioner,
supra; Phillips v. Commissioner, supra, we note that petitioner’s
primary purpose for constructing the barn was to improve horse
breeding, and it is as consistent with a hobby as with a
business.
Petitioner’s testimony that she had a simple and concise
business plan “to raise good quality horses, well-trained horses,
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