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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
108(c).
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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