How will owning a race horse be handled

[mickseven]

I own a race horse. It races at the lowest level claiming $5k (which mean someone can take it for that claiming price). Will be filing ch. 7 down the road, but not sure what to do in the mean time. It costs about $1500 to feed and train a month. Since I've had it expenses on it have been about $9k but it has won purses of $3k. so net -$6k Not sure if it is sellable (what would you pay for it) , might be to give away. My options as I see them.

a. I can sell or give it away - which will save me $1500 a month, but how would trustee look at it - gave away an asset which might get $2k or nothing but has a neg. net present value. Might think I tried to pull something. Is it worse in trustees eyes to continue to pay $1500 month or sell it at any price?

b. can keep it - list on my assets - and let trustee deal with selling /giving away etc. The horse will still need someone to pay for it's food. Plus shipping it wherever it goes. Does trustee have funds to pay for feeding a horse? If trustee doesn't what to try and sell it or says it is worthless- I get to keep it, correct. But I still have the negative cash flow - which trustee won't like. Would trustee let me give it to someone. Horses have lost most of their value like other assets so selling in this evironment would be difficult.

c. I could arrange to give it to the trainer or just stick him with it. But would want trustees premission first - but not sure how to arrange that.

What info will the Trustee want to see? I have bills, winnings, past performances, proof nobody in the past would pay $5k for it.

I am speaking with lawyer soon. But wanted some insight because they may not have dealt with race horse in the past. I want to dump it - but don't want it to become a bigger issue down the road.

[Woah]

The trustee wants any asset not exempted that he can make money on to pay your creditors and keep some for himself. That being said, your best bet in my opinion is to move the horse to a regular boarding facility or a friends place, somewhere with as little expense as possible. I don't know if your horse is a stud or not, but many stables can handle that anyway if you notify them.

List the horse in bk because you will obviously have a money trail in and out surrounding him. You can't just say he is a pet like mine is. Since you don't really care if you keep him wait until the bk process is over and that way the trustee can make up his mind and you are not under stress of doing the wrong thing. Basically the trustee will see that you are making horsey available to him if he decides to take him. Meanwhile he is only costing you a roof, hay and grain. No one will be able to fault you for not keeping him with the trainer if you are in BK.

Once the bk is over, if the trustee doesn't want to take the horse, you can do with him what you want. I'd ask the attny what happens if you end up with the horse, resume racing and making money with him. I doubt the trustee will follow your case after it closes just because of a racehorse, but I wouldn't send him to the derby or anything lol.

please keep posting about this, I'd like to know what happens

[Woah]

Oh and from the sounds of it you will probably end up with him. You are right, the trustee will have to consider the costs involved with taking on a living breathing thing that needs shelter, food and is, as you stated, going to be hard to get rid of right now.

That said, you will rest easier if you just turn him out somewhere and deal with getting rid of him after the bk is over and the trustee has had his shot. A lot easier than if for some reason you give him away and the trustee then decides to go after him.

[dingdong]

Where do you live? In CA, there is a chapter of the United States Pony Club that takes donations and since they are a non-profit, the donation is tax deductable, I believe up to 5000.00 unless you have proof that the horse is worth more. If he is sound and trainable in another discipline, like eventing, they might be interested.

There are probably other organizations that would do they same thing across the country.

Just thought I would throw it out there as an option.

The donated horses are "doted" on for life and they live a long and happy life being turned out all day and ridden by kids who lease them.

One ex race horse that was donated because he was no longer winning and the owner tried to drown him 3 times for the insurance money ( literally tied a concrete block to his head and dumped him in a large pond) and then tried to sell him for slaughter at the slaughter horse auction, was bought by the owner of the ranch where Pony CLub is held, ended up as horse of the year in eventing for our region for 3 years in a row. He lived at pony club until he was almost 30 years old.