Keating v. Commissioner

MURPHY, Circuit Judge.

Nora E. Keating and Richard L. Shearer filed a petition in United States Tax Court challenging the determination of the Commissioner of Internal Revenue (Commissioner) that because Keating engaged in her horse breeding activity as a hobby rather than for profit, losses from the activity were incorrectly deducted on their 1996 through 2002 tax returns, resulting in deficiencies in their federal income tax obligations. Following a trial the tax court 1 concluded that Keating had not engaged in the horse activity for profit and ordered Keating and Shearer liable for all…