- 3 -
not by the lottery operator, are includable in gross income.
Paul v. Commissioner, T.C. Memo. 1992-582. As we understand,
petitioner's position is that she incurred losses from her
gambling activities during 1997, and, when considered with other
itemized deductions she did not claim on her return, the amount
would have been greater than the standard deduction of $6,050
that she claimed. Petitioner claims that she donated to Goodwill
Industries tangible personal property that she estimates had a
fair market value of $1,225 and that she is entitled to a
charitable deduction in that amount. The record shows that
petitioner also paid $653 in State income taxes.
In the case of an individual, section 62(a) defines adjusted
gross income as gross income less certain deductions, including
deductions attributable to a trade or business carried on by the
taxpayer. Sec. 62(a)(1). If petitioner's gambling activity
constituted a trade or business, her gambling losses would be
deductible from gross income in arriving at adjusted gross income
on Schedule C, Profit or Loss From Business. See id. If
petitioner's gambling activity did not constitute a trade or
business, her gambling losses would be deductible as an itemized
deduction in arriving at taxable income on Schedule A, Itemized
Deductions. Sec. 63(a). But, regardless whether or not the
activity constituted a trade or business, section 165(d) provides
that “Losses from wagering transactions shall be allowed only to
Page: Previous 1 2 3 4 5 6 Next
Last modified: May 25, 2011