The NCWHLA Show is scheduled for Saturday, May 18 at Biggerstaff Park in Dallas, NC. Wayne Dean will be the judge for the event. There is a new class sheet posted in the calendar section of the NCWHA.org website. This show will be under SHOW rules: All Trail Pleasure Classes are amateur, All Country Pleasure Classes are Keg Shod and All Lite Shod classes will say Open with tungsten shoes noted as allowed.

Ms. Jean Scott of Lewisburg, Tennessee passed away on May 8, 2013 at 6:00 am. She held the record for attending every night of the Tennessee Walking Horse Celebration from its beginning until she was not able to attend because of health related issues in 2007 or 2008.

Friday March 24^th, 2013 from 10:00am-3:00pm Farm Paint will host their Open House at their new location. The address is 4024 Barfield Crescent Road Murfreesboro, TN.

By John Alan Cohan, Attorney at Law

For any business, long-term profit potential may hinge, in some measure, on efforts to reduce costs, getting better prices for goods and services, consolidating operations, layoffs, or efforts to promote efficiency.

For many people in the horse or livestock business, the operations have a history of losses, but the expectation is that future operations will be profitable.  The IRS will want to see evidence that the taxpayer has taken steps to correct or abandon unprofitable strategies, and to demonstrates steps taken to improve operations.

Often, the IRS will argue that a profit motive ultimately depends on whether the taxpayer expects future earnings and appreciation to be sufficient to recoup accumulated losses of prior years.  The IRS will want to see a meaningful plan for recouping losses sustained in prior years.

This seems inherently unfair.  Other businesses are not asked to demonstrate a plan to recoup past losses.  In some industries past losses have been so great that the companies might never really end up recouping them.

According to Terrence D. Miller, CPA, of Miller and Miller Accountancy Corporation  in Fresno, California, “In my experience with audits, quite often an auditor will be obsessed with the cumulative losses and they fixate on it.  And the losses might not ever be recoupable.  Luckily there is a Tax Court case on the subject and usually when you show auditors this case they move on.”

He is referring to Helmick v. Commissioner IRS, T.C. Memo 2009-220, which involved a horse breeding and boarding operation with losses for a period of 17 years.  The Tax Court held in favor of the taxpayers, and rejected the IRS “recoupment” argument.

The court said that the IRS “seems to assume that the requisite profit motive as of any given year must involve an expectation that even all past losses will be recouped, so that the activity will have generated a net profit over its entire course.  This position distorts the notion of profit motive for purposes of section 183.”

The court cited a hypothetical example:  “If a natural disaster caused the death of 90 percent of a rancher’s herd and resulted in a catastrophic loss that could never be recouped, but the rancher thereafter expected to generate an overall prospective profit by breeding and selling the remaining 10 percent of his herd on a foregoing basis, then he could not be said to lack a profit objective after the disaster merely because he would never recoup the prior loss.”

The court pointed out – and this is very important – that the “recoupment” concept is forward looking.  That is, the profit objective is shown where the taxpayer expects that the activity will generate an overall profit between the year being audited and the time at which future profits are expected.

To some extent, taxpayers often can explain a poor history of profits due to circumstances beyond their control, including personal issues, casualties, stillborn foals, and the negative effect of the recession on horse sales.  The implication is that the activity, in a given year, would have been profitable if these events had not occurred.

Whether an activity producing losses is a business or a hobby is a question that has generated substantial litigation in U.S. Tax Court.  If faced with an audit of horse or livestock activities, it can be frustrating when confronted with an IRS auditor who wheels out the “recoupment” argument.  Thankfully, there are Tax Court cases, such as that mentioned above, that provide a rational approach in determining whether the taxpayer has a bona fide profit motivation.

[John Alan Cohan is a lawyer who has served the horse, livestock and farming industries since l98l.  He can be reached at: (3l0) 278-0203, by e-mail at johnalancohan@aol.com, or you can see more at his website: www.johnalancohan.com.]

It was great the way The Scoop gave the results for the Gulf Coast Charity Trainers Horse Show. Most of us never know who trains the Amateur horses.

Thanks for a good job.

Richard McBrayer

Hampton, GA

Heart of America Walking Horse Association, the oldest recognized HIO in the country announces whom to contact to affiliate your show. If your show is affiliated already with another HIO HAWHA will waive the affiliation fee if you wish to change your affiliation to Heart of America. Inspection fee is $10.00 per horse of which $4.00 goes to The Calvary Group.

With the inclusion of Pride HIO DQP’s and Judges with HAWHA affiliations will be handled by the following.

Kentucky and All States East

 Sam Howard, DQP Coordinator  859-582-9778

 Missouri, Illinois and All States West

 Susie Graham, HAWHA Licensing and Enforcement Secretary 417-327-2942

1018 N. Market, Boliver, MO 65613

 General Information

 Everett Clamp, President 417-531-0991

 Margaret Hickman, Vice President 417-288-2699

 Matthew McWilliams, Sec. 573-245-9202

4037 Springfield Rd, Bourbon, MO 65441

SHOW DATES

Show dates are coming in daily from many states. We hope to publish an updated list

within the next week outlining other shows.  Please let us know of your upcoming show dates.

Here is a partial list of shows at this time.

HAWHA Spring Classic, May 31- June 1, Judge:Clay Smith, Mt. Vernon, KY, Flying M Arena, Mt. Vernon, MO

Buffalo Saddle Club, June 22, Saddle Club Arena, Buffalo, MO

Bolivar Saddle Club, July 4, Bolivar Saddle Club Arena, Bolivar, MO

Midwest Walking Horse Trainers Association, July 13, Buffalo Saddle Club Arena, Buffalo, MO

TWH of Minnesota Presents Summer Nights, August 16-17, Fairgrounds Mason City, Iowa

Bill Maack Memorial Horse Show, September 21, Bolivar Saddle Club Arena, Bolivar, MO

HAWHA Fall Championship, October 3-5, Flying M Arena, Mt. Vernon, MO

HAWHA Lebanon Agri-days Show, October 12, Lebanon Saddle Club Arena, Lebanon, MO

The Georgia Walking Horse Association will be having their horse board meeting on May 14, 2013. The meeting will be at  7:00pm at the Monroe Veterinary Clinic, Monroe, GA  all members are encouraged to attend.

One of Canada’s premier horse expositions, the Red Deer, Alberta, edition of Mane Event was held April 26th – 28th, 2013 at beautiful Westerner Park. Approximately 40,000 horse enthusiasts attended the event. The Tennessee Walking Horse Association of Western Canada hosted a breed information booth which was manned by Bill and Grace Adams, as well as other members of the organization, each day from 8:00 am until 8:00 pm. Caroline Hoffman represented the Tennessee Walking Horse Breeders’ And Exhibitors’ Association and presented clinics on the topics of Gait Recognition, Riding for Better Gaits, and Easy Gait Solutions. There were eight riders, ranging in age from eight to 60, in each clinic and each clinic attracted right around 100 spectators.

Georgia Walking Horse Exhibitors’ Association because of the extremely rainy and windy weather forecast the Walton County Horse show on May 4, 2013 in Monroe, GA was cancelled. This show has been will re-scheduled for June 1^st.

This Thursday’s Show: The Tennessee Walking Horse–The Future

Tennessee Walking Horse Breeders’ and Exhibitors’ Association President Tracy Boyd and Executive Director Ron Thomas will talk about the role of TWHBEA in the Tennessee Walking Horse industry and their goals and vision for the future. We’ll learn about programs available to TWHBEA members and discuss opportunities for expansion and growth for the Tennessee Walking Horse in the United States and internationally.

You can listen to the live show on your computer, smart phone or tablet.