Steps To Making A Horse Racing Partnership Succeed For You
Maybe you are giving some consideration to joining a horse racing partnership or syndicate, or possibly you are already actively involved? If either is the case, it’s vital you quickly familiarize yourself with how to set up all your records correctly so that you keep a complete track of your share and find yourself fully prepared for tax time or other financial necessities.
If you expect the IRS to view your horse racing venture as a business, you will need to be systematic and professional in your approach. To set off on the right foot, in advance of investing in a partnership, you need to establish positively just what you want to achieve as well as what the syndicate is offering. A business plan should list precisely what you are hoping for in a partnership and what you anticipate happening with your investment. A few important items you should list in your horse racing business plan are:
* Exactly how you expect to acquire the finances needed, first for the original purchase into the horse racing partnership, and then to pay the monthly outgoings.
* A best estimate that the partnership’s length, the duration of the contract – 1 year, 2 years, etc.
* Means of obtaining the horse, where is it coming from, auction, private sale, etc.
* A budget projecting both potential income and expenses.
* Mark out framework within which the partnership will function, specifically, do you want a horse that will be competitive at a national level or would you be more comfortable racing locally.
* Be specific regarding insurance for your purchase, for example liability, serious injury and mortality insurance.
* Is there a clause in the contract so you can get out of the partnership should you choose to do so?
As well as a good business plan, you should also learn how to organize your business correctly, accounting for all income and expenses. Important guidelines you need to follow so that your business runs smoothly are:
* Seek out an accountant who is well acquainted with horse racing partnerships.
* Open a new checking account restricted to transactions covering your share in the horse and name it accordingly – Elizabeth Jones dba Jones Racing, LLC.
* Keep all bills, receipts, check stubs from winnings, etc. that relate to your horse racing partnership activities.
* Keep an appointment book and travel log to document appointments, visits to the racing stable, phone calls, any travel, all associated mileage, etc.
With just a little forethought, it’s fairly easy to involve yourself in the “Sport of Kings” with specific prospects and arrangements, which will guide you toward selecting the horse racing partnership that’s right for you. You will also be set up to record all your tax related activities methodically. Good preparation eliminates issues and headaches, all of which will contribute to your increased enjoyment in your racehorse ownership!