Robert G. Leslie and Marilyn B. Leslie - Page 32

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          v. Commissioner, a Memorandum Opinion of this Court dated                   
          Mar. 11, 1954.  Petitioners state that, as part of the cost basis           
          and the selling price, such expenses form part of the loss from             
          the trading which is otherwise allowable under DEFRA section                
               Petitioner's reliance on section 1.263(a)-2(e), Income Tax             
          Regs., Spreckles v. Helvering, supra, and Soeder v. Commissioner,           
          supra, is unfounded since both the regulations and the cases                
          cited deal with taxpayers who were involved in securities or                
          commodities transactions entered into primarily for profit.                 
          Since we have found that petitioner entered into the Hunter gold            
          futures program in order to obtain substantial tax benefits, the            
          above-listed fees paid by petitioner constitute payments to                 
          purchase tax deductions and do not form part of the cost basis of           
          petitioner's gold contracts or reduce the selling price of those            
          contracts.  Therefore, the fees paid by petitioner are nonde-               
          ductible personal expenditures.  Ewing v. Commissioner, 91 T.C.             
          at 421; Brown v. Commissioner, 85 T.C. 968 (1985), affd. sub nom.           
          Sochin v. Commissioner, 843 F.2d 351 (9th Cir. 1988); Zmuda v.              
          Commissioner, 79 T.C. 714 (1982), affd. 731 F.2d 1417 (9th Cir.             
          1984); Houchins v. Commissioner, 79 T.C. 570 (1982); see also               
          Falsetti v. Commissioner, 85 T.C. 332 (1985).                               
          The 1982 Deduction                                                          
               Petitioners contend that, if the Court determines that the             
          spread transactions were not entered into for profit, DEFRA                 

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