How To Make A Horse Racing Partnership Work For You

Posted on | December 10, 2008 |

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:

* Your strategy for providing the required funds, both for the original horse racing partnership investment, and then to meet the monthly bills.

* 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.

* An estimate of anticipated winnings and also costs.

* Define the boundaries in which the partnership will operate, for example, do you want to race regionally or go national.

* Define your expectations for insuring your investment, (i.e. liability and mortality insurance).

* Is there a clause in the contract so you can get out of the partnership should you choose to do so?

Looking beyond a business plan, it will be necessary for you to construct your business appropriately, recording income and expenditures. Some points you should consider when setting up your books are:

* Find an accountant with verifiable experience in horse racing partnerships.

* Establish a separate checking account for your share of the horse racing partnership and label it as such for example, John Smith d/b/a Partnership Name, LLC.

* Retain every invoice you receive, receipt of winnings, check stub you write that apply to your horse racing partnership enterprise.

* Establish an engagement book and travel log and carefully record all mileage to and from the track, phone calls, appointments, etc.

With proper planning, you can get started in the sport of horse racing with defined expectations and organization, which will help you choose a horse racing partnership more quickly. You will also be prepared to keep track of your equine activities in a businesslike manner, which will prepare you for tax time. Being prepared prevents worries or problems, which will allow you to really kick back and enjoy your thoroughbred ownership!

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