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selling securities in that year. On his 1991 return, petitioner
treated the losses from securities transactions, which in this
year were only $8,157, as capital losses, on a Schedule D.
Questioned about his treatment of securities losses on the 1988
and 1991 returns, petitioner testified that he had been
"experimenting" with the "on the book" method in 1988, but did
not use it for the entire year4, and that he did not believe the
level of his activities in 1991 was sufficient to make him a
dealer.5
We find petitioner's efforts to distinguish his situation in
the respective years unpersuasive. We find more persuasive
respondent's contention that the difference between taxable year
1988 and taxable years 1989 and 1990 was that in the latter two
years, but not in 1988, petitioner had otherwise "unsheltered"
pension and IRA distributions of $100,000 and $152,000,
respectively.
There are also inconsistencies in the theory petitioner
advances for the tax treatment of his losses from futures
4Petitioner's own witness, however, his broker for all stock
option and stock transactions, testified that once petitioner
commenced using the "on the book" method in 1988, he used it
virtually exclusively until he ceased transactions in securities
in 1991.
5The level of activity, in any event, goes to the question
of whether petitioner was engaged in a trade or business, a
different inquiry from whether he was a dealer. See King v.
Commissioner, 89 T.C. 445, 458 (1987).
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