- 3 - v. Groetzinger, 480 U.S. 23, 34 (1987). Gambling losses are deductible only to the extent of the taxpayer's winnings from such transactions. Sec. 165(d); sec. 1.165-10, Income Tax Regs. Taxpayers not engaged in the trade or business of gambling must report all gambling winnings as gross income and may claim gambling losses only as an itemized deduction to the extent of the gambling income. McClanahan v. United States, 292 F.2d 630, 631-632 (5th Cir. 1961). We hold that petitioners must include the $3,500 of gambling winnings in their income. Petitioners have no other itemized deductions to add to the $3,500 of gambling losses which were eligible to be taken as an itemized deduction. Petitioners benefited from the election of the standard deduction of $6,700. Accordingly, we sustain respondent's determination on this issue. Reviewed and adopted as the report of the Small Tax Case Division. Decision will be entered under Rule 155.Page: Previous 1 2 3 4
Last modified: May 25, 2011