Some horses, like lots of Appy's, have very short tails. I'm not sure, though, interesting question.
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At the moment Morgans are not allowed to use fake tails. Now, there is something going around that is either contemplating or has decided to allow fake tails in the future. I heard about it at nationals, but cannot remember if they were saying the morgans will be allowed to use them or if it was just being reconsidered.