- 7 - unique arguments that would cause us to stray from the holding we reached in Davis v. Commissioner, supra; the end result is the same. The relevant events occurred after Mr. Wolman won the lottery, i.e., the assignment of future lottery installment payments, and those events do not change his receipt of ordinary income into gain from a sale of a capital asset. Further, petitioners’ argument that their assignment of all rights and benefits related to the lottery installment payments caused the character of the transaction to change must also fail. In Lattera v. Commissioner, supra, the taxpayers similarly assigned their “rights, title, and interest in the lottery prize” to a third party, and we held that the amount received by the taxpayers from the third party for the assignment of future lottery payments was ordinary income, not capital gain. See also United States v. Maginnis, 356 F.3d 1179, 1186-1187 (9th Cir. 2004)(concluding that a sale of an entire interest in a lottery winning is “not a persuasive reason to treat the sale of that right as a capital gain.”). Pursuant to Davis v. Commissioner, supra, and its progeny, we hold that the amounts received by petitioners from Capital First in exchange for Mr. Wolman’s right to receive the remaining lottery installment payments are ordinary income and not capital gains.Page: Previous 1 2 3 4 5 6 7 8 Next
Last modified: May 25, 2011