Terri L and Austin W. Hartsock - Page 12

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          petitioners rely on, inter alia, certain workpapers that they               
          prepared and that purport to show how they calculated the gam-              
          bling losses that they contend they incurred at Harrah’s during             
          1999.                                                                       
               We have serious reservations about the reliability of the              
          self-serving and uncorroborated workpapers on which petitioners             
          rely.9  We also have serious reservations about the reliability             

               9For example, one of the workpapers that petitioners pre-              
          pared purports to show their estimate of the gambling losses that           
          they incurred at Harrah’s on Aug. 13 and 14, 1999.  The total               
          gambling winnings shown on that workpaper for those dates are               
          different from the total gambling winnings shown (1) on the                 
          respective Harrah’s substitute Forms W-2G with respect to those             
          dates and (2) on another workpaper that petitioners prepared and            
          that purports to show the total of petitioners’ gambling winnings           
          at Harrah’s on Aug. 13 and 14, 1999, as reflected on such respec-           
          tive forms with respect to Aug. 13 and 14, 1999, as well as other           
          gambling winnings that petitioners claim they had at Harrah’s on            
          such dates and that are not reflected on such respective forms.             
               Moreover, one of the workpapers that petitioners prepared              
          purports to show their estimate of the gambling losses that they            
          incurred at Harrah’s on Sept. 4, 1999.  The total gambling                  
          winnings shown on that workpaper for that date are different from           
          the total gambling winnings shown on (1) Harrah’s substitute Form           
          W-2G with respect to Sept. 4, 1999, and (2) on another workpaper            
          that petitioners prepared and that purports to show the total of            
          petitioners’ gambling winnings at Harrah’s on Sept. 4, 1999, as             
          reflected on Harrah’s substitute Form W-2G with respect to that             
          date, as well as other gambling winnings that petitioners claim             
          they had at Harrah’s on such date and that are not reflected on             
          such form.                                                                  
               Another example of the unreliability of petitioners’                   
          workpapers is that one of those workpapers indicates that peti-             
          tioners estimated that Mr. Hartsock wagered in a $25 slot ma-               
          chine, and lost before any reduction for time spent not wagering,           
          $22,800 during what they computed to be a 19-minute period                  
          between 10:22 p.m. and 10:51 p.m. on Aug. 14, 1999.  However, the           
                                                             (continued...)           





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