There’s a live horse tale coming off the bench in the LA regular session today, Laurel Daphne, Docket No. 8615-19.
It’s coming from Judge Emin (“Eminent”) Toro, and it’s live as I write this (2:40 p.m., EDT, 3/26/21). I’m writing this as it’s coming through the internet, and the YouTube video is none too clear, so bear with me. Look for the whole story to hit the opinions page next week.
Diva, Sugar and Cherry (? phonetic) are the horses. Plus a healthy gelding for petitioner’s personal use, who was “healthy and didn’t eat much,” so she didn’t need to segregate his expenses.
It’s a seventeen (count ’em, seventeen) year string of losses, and a sad tale of injured foals. Only one foal sale. And no logs, separate bank account, and “(S)he should have kept better records.” Her ranch appreciated in value, but that appreciation was independent of the horsing around, and she didn’t buy the property (it was a gift).
Of course, she and her children had fun.
There’s the usual trudge through the “goofy regulation,” Reg. Section 1.183-2(b), and Judge Eminent can trudge with the best. The usual “somber reasoning and copious citation of precedent” results in a loss in Tax Court to match the horse-drawn losses. Judge Posner would reiterate his often-expressed review.
Tax Court is manifesting a deep understanding of horse breeding, horse training, and other horse-related matters.
