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sickness, even if it were for punitive damages. Accordingly, we
hold that petitioner has not shown that he is entitled to exclude
the $325,000 settlement from his gross income.
II. Commodity and Option Trading Activity
During the years under consideration, petitioner was a
successful stockbroker earning annual commissions ranging from
$200,000 to in excess of $1 million. In addition, during the
years under consideration, petitioner claimed to be in the trade
or business of trading options and commodities. Substantially
all of the transactions reported from this activity consisted of
option trading in three separate stock brokerage trading
accounts. The three accounts included one in petitioner’s name,
one held jointly with Mrs. Corrigan, and one in Mrs. Corrigan’s
name. Likewise, the cost of goods sold reflected on the
Schedules C was, in substantial part, the purchase price of the
options that had been sold. In addition to the cost of goods
sold, petitioner claimed deductions for various expenses. The
activity was reported on the Schedules C under the name “Corrigan
Enterprises”, and losses were claimed for 1987, 1988, 1989, and
1991 of $96,098, $25,774, $124,073, and $34,907, respectively.
Respondent determined that this activity produced capital
rather than ordinary gains and losses. In addition, respondent
allocated the gains and losses between petitioner and Mrs.
Corrigan in accord with their ownership of the accounts,
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