Schedule C Profit or Loss from Business is the form you would use. Consider it self-employment income. In order to take a portion of the purchase price, you will need to claim depreciation. Here are several links you may find helpful:
http://smallbusiness.chron.com/irs-rules-regulations-horse-related-businesses-68158.html
http://www.thehorse.com/articles/35597/cracking-the-tax-code
http://www.horsechannel.com/horse-news/2011/02/07/tax-issues-equestrians.aspx
