Robert K. and Cheryl Hardwick - Page 13




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          borrowing, represented here by marker debit transactions, does              
          not substantiate actual losses of those borrowed funds on                   
          gambling.  Schooler v. Commissioner, supra at 870.                          
               Overall, there does not appear to be a correlation between             
          the win-loss statements, petitioners’ Forms W-2G, Mr. Hardwick’s            
          log, and petitioners’ bank account statements.  Notably, the win-           
          loss statements reflect that petitioners had gambling winnings              
          totaling $115,142, while the Forms W-2G provide that petitioners            
          had total gambling winnings of $322,50010.  Petitioners have not            
          accounted for the $207,358 difference in gambling winnings                  
          between the win-loss statements and Forms W-2G.  At trial,                  
          Mr. Hardwick was unsure of petitioners’ total dollar amount of              
          gambling winnings or losses, explaining that he only kept track             
          of their net amount won or lost.                                            
               Petitioners’ bank account statements reflect that                      
          petitioners had large sums of money being deposited and withdrawn           
          on a monthly basis, and there does not appear to be a correlation           
          between petitioners’ monthly bank account balance and any                   
          substantial gambling win or loss in 2002.  For example, according           
          to Mr. Hardwick’s log, petitioners lost $25,000 in February 2002,           
          yet their bank account balance increased by approximately $33,000           
          for the month of February.  This might reflect the 30 to 45 day             


               10This amount is based on the parties’ stipulations.  See              
          supra note 7.                                                               





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