Lee B. Arberg and Melissa A. Quinn - Page 1
T.C. Memo. 2007-244
UNITED STATES TAX COURT
LEE B. ARBERG AND MELISSA A. QUINN, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 15376-05. Filed August 27, 2007.
Prior to 1999, a brokerage account at E Trade
Securities, Inc., was established in the name of P-W.
For 1999, P-W filed a separate return reporting capital
gain income from activity in the E Trade account. For
2000, Ps contend that losses generated in the E Trade
account are entitled to ordinary income treatment by
reason of a business of P-H as a trader in securities
and that various expenses should be allowed as
deductions of the securities trading business and/or a
consulting business of P-H.
Held: Gains and losses in the E Trade account
must be attributed to P-W and are capital in nature.
Held, further, Ps are not entitled to expense
deductions in excess of those allowed by R.
Held, further, Ps are liable for the accuracy-
related penalty pursuant to sec. 6662, I.R.C., for
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Last modified: November 10, 2007