Robert K. and Cheryl Hardwick - Page 11

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          Commissioner, 359 F.2d 64 (1st Cir. 1966), affg. T.C. Memo. 1965-           
          247; Stein v. Commissioner, 322 F.2d 78, 83 (5th Cir. 1963),                
          affg. T.C. Memo. 1962-19; Schooler v. Commissioner, 68 T.C. 867,            
          871 (1977); Lutz v. Commissioner, T.C. Memo. 2002-89.                       
               In Doffin, the taxpayer had pull tab winnings of $46,240 and           
          $32,571 for 1986 and 1987, respectively.  The taxpayer did not              
          keep contemporaneous records of his daily winnings and losses and           
          did not retain any losing tickets to substantiate his losses.               
          The Commissioner allowed the taxpayer a deduction for gambling              
          losses in the amount of $494 for 1986, which was based on the $2            
          per pull tab cost of the taxpayer’s 247 winning pull tabs for               
          that year.  Pursuant to the rule of Cohan, the Court allowed the            
          taxpayer to deduct additional losses of $39,000 and $26,000 for             
          1986 and 1987, respectively.  The Court’s approximation of the              
          taxpayer’s gambling losses pursuant to the rule of Cohan was                
          based on the Court’s finding that it was highly improbable that             
          the taxpayer purchased only winning tickets, and that the                   
          taxpayer’s lifestyle and financial position indicated no                    
          accessions to wealth commensurate with the amount of net gambling           
          winnings determined by the Commissioner.  The taxpayer lived in a           
          mobile home, had little income and few assets, and even sold                
          assets and borrowed money during the years at issue to support              
          his gambling habit.                                                         

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