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Wagering Loss Deduction
The first issue for decision is whether petitioner is
entitled to deduct wagering losses in the amount of $19,690
for the taxable year 1991. As noted above, respondent
disallowed all of the wagering losses claimed by petitioner
because petitioner had failed to substantiate the
deduction. In his posttrial brief, petitioner acknowledges
that he did not substantiate this deduction, but he argues
that some amount should be allowed as a deduction. His
brief states as follows: "Although it is true the
petitioner did not produce complete and accurate records
of gambling losses after seven years time, some allowance
should have been made for the losses sustained".
Respondent argues that petitioner did not prove the amount
of his gambling losses or that his gambling losses exceeded
the amount of his unreported gambling winnings.
Section 165(d) allows taxpayers to deduct losses from
wagering transactions to the extent of the gains from such
transactions. In order to establish entitlement to a
deduction for wagering losses in this Court, the taxpayer
must prove that he sustained such losses during the taxable
year. See Mack v. Commissioner, 429 F.2d 182 (6th Cir.
1970), affg. T.C. Memo. 1969-26; Stein v. Commissioner, 322
F.2d 78 (5th Cir. 1963), affg. T.C. Memo. 1962-19. He must
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