Horse Industry
Horse Industry
|
|
|
New Tax Case Rules Against Taxpayer’s
Horse Activities (Elizabeth Giles) During the subject years, she did much of the feeding, cleaning, grooming, atraining of her horses and she did all of the horses' worming and vaccinations, and spent about 30 hours or more per week in the horse activity (but there was no documentary evidence to prove this). ... Click for more. New Tax
Case Rules Against Taxpayer’s Horse Activities (Jane
Freed) A new tax case, JANE FREED v. COMMISSIONER OF INTERNAL REVENUE, T.C. Memo 2004-215 (September 23, 2004) involved a deficiency of $64,213 on the question of whether the taxpayer operated her thoroughbred horse breeding and racing activities for profit in 1996. The court ruled for the IRS.... click for more
Activity for Profit Measured by Time Spent An area of concern in IRS audits of farming, livestock and horse activities is the amount of time expended by the taxpayer in the activity. A recurring problem is that taxpayers do not keep contemporaneous time records, but instead “reconstruct” time records in the face of an audit. This can always be a hurdle because it suggests that you did not really conduct the activity in a businesslike manner, but instead simply prepared self-serving records after the fact, and only because the IRS has indicated its intention to conduct an audit.... Click for more.How to
Handle an IRS Audit Excessive business deductions by owners and breeders of horses, livestock or general farmers--or in other businesses activities-- can be a red flag that triggers IRS audits.... click for more. Are More People Being Audited in the Startup Phase? By John Alan Cohan, Attorney at Law I have been asked to comment on what appears to be an upsurge in audits by the I.R.S. with respect to startup horse and farming activities. During the past few years there has been an unusually high number of taxpayers in the early startup phase of their activity being subjected to audits. Is this a trend? Is there some reason for this? Is it simply a coincidence? ... click for more Creative Advertising Methods By John Alan Cohan, Attorney at Law Robert Sieber of Cincinnati, Ohio, was a self-employed custom builder of homes and barns. Mr. Sieber enjoyed playing polo, and was captain of his polo club. His sons and daughter participated in the team, and his wife fixed lunches for the team and guests. The team won various championships and garnered local newspaper coverage. ... click for more Operating in a Businesslike Manner By John Alan Cohan, Attorney at Law In hobby loss audits, the IRS sometimes views horse activities as a means of generating tax losses, rather than as a profit-oriented venture. The IRS gives the greatest problems to individuals who have had a significant history of losses that they use to write off other income... click for more WHAT IS A TAX OPINION LETTER? By John Alan Cohan, Attorney at Law An area of concern for people in the horse, livestock and farming industries--among many other fields--is how to withstand IRS scrutiny in the event of an audit. In judging whether you are engaged in a business rather than a hobby, one element is whether you have consulted experts so as to determine if the activity is conducted in accordance with IRS Regulations.... click for more
|
