John Allen and Glenna A. Lyle - Page 15

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          his gambling losses as a tax preference item under the minimum              
          tax scheme governed by sections 55 and 56.  See Valenti v.                  
          Commissioner, T.C. Memo. 1994-483.  Petitioners are not entitled            
          to gambling losses in excess of their income from gambling.2                
          VI. Accuracy-Related Penalty Under Section 6662                             
               Respondent also determined that petitioners were negligent             
          and liable for an accuracy-related penalty under section 6662(a).           
          Section 6662(a) and (b)(1) imposes an accuracy-related penalty              
          equal to 20 percent of the portion of an underpayment that is               
          attributable to negligence or disregard of rules or regulations.            
               In determining whether petitioners were negligent in the               
          preparation of their returns, we take into account petitioner's             
          tax experience.  Petitioner, a self-proclaimed "trained tax                 
          specialist", should have realized that the deduction of 7 months            
          of living expenses as job-hunting expenses after a limited job-             
          hunting effort was not reasonable.  Combining that with                     
          petitioner's gambling losses presents a situation that was "too             

               2Petitioners made several other arguments which we found to            
          be outlandish, such as their request for $15 billion in punitive            
          damages.  To the extent we have not addressed petitioners' other            
          arguments we find them to be without merit.                                 

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