224 F.3d 16 (1st Cir. 2000)
LOUIS A. FILIOS; ESTATE OF EMMA L. FILIOS, DECEASED, PETITIONERS, APPELLANTS,V.COMMISSIONER OF INTERNAL REVENUE, RESPONDENT, APPELLEE.
No. 99-2180
United States Court of Appeals For the First Circuit
Heard June 6, 2000Decided August 18, 2000

ON APPEAL FROM A DECISION OF THE UNITED STATES TAX COURT.
Louis F. Brush for appellants.
Curtis C. Pett, Attorney, Tax Division, Department of Justice, with whom Paula M. Junghans, Acting Assistant Attorney General, and Ann B. Durney, Attorney, Tax Division, Department of Justice, were on brief, for appellee.
Before Torruella, Chief Judge, Stahl and Lipez, Circuit Judges.
Torruella, Chief Judge.


1
This appeal arises from a decision of the United States Tax Court finding petitioners Louis A. Filios and Emma L. Filios liable for deficiencies in their 1992 and 1993 income tax payments. The question presented to theBreeding Activity


11
Petitioner bought his first thoroughbred in 1955. In general, he spent between ten and twenty hours per week engaged in horse racing and breeding activities. Petitioner never trained or stabled any of his horses at or near his home in West Springfield, he did not own a farm or any equipment used to train his horses, and neither he nor members of his family rode the horses. On average, he retained his horses three to four years, giving him adequate time to assess their racing potential. Petitioner's best horses generally ran in races paying purses from $12,000 to $30,000.

A. Horse Publications

12
Dating back to 1959, and continuing through the years in question, petitioner subscribed to various industry publications, including The Blood Horse and Thoroughbred Record. In addition to