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affg. T.C. Memo. 1983-247 (holding that deductions for State
taxes attributable to gambling income are limited under section
165(d)); Kochevar v. Commissioner, T.C. Memo. 1995-607 (holding
that slot-machine players, even if considered to be in the trade
or business of gambling, could deduct gambling losses and
expenses, including automatic teller machine charges, office
supplies, travel mileage, and meals, only to the extent of their
winnings); Valenti v. Commissioner, T.C. Memo. 1994-483 (holding
that a deduction for losses incurred in wagering transactions is
subject to section 165(d) regardless of the fact that the
taxpayer was in the trade or business of gambling); Kozma v.
Commissioner, T.C. Memo. 1986-177 (construing the phrase “losses
from wagering transactions” as used in section 165(d) to include
expenses incurred by a professional gambler for transportation,
meals, lodging, admission fees, and office supplies).
According to petitioners, the precedent established by the
Offutt line of cases should not be followed because the reasoning
expressed in those cases is based more upon a prejudicial view
towards gamblers and gambling than technical considerations. We
disagree with the premise as well as the proposition. We are
satisfied that following the precedent established by the above
line of cases leads to a result in this case that is supported by
the express language of section 165(d) and, although petitioners
suggest otherwise, entirely consistent with Congressional
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