- 3 -
petition with this Court, and a trial was held on September 25,
2007, in St. Paul, Minnesota. At trial, respondent conceded that
petitioner had presented sufficient documentation to substantiate
$127,165 in gambling losses.2
OPINION
Gross income includes all income from whatever source
derived, including gambling. See sec. 61; McClanahan v. United
States, 292 F.2d 630, 631-632 (5th Cir. 1961). In the case of a
taxpayer not engaged in the trade or business of gambling,
gambling losses are allowable as an itemized deduction, but only
to the extent of gains from such transactions. Sec. 165(d);
McClanahan v. United States, supra at 632 n.1 (citing Winkler v.
United States, 230 F.2d 766 (1st Cir. 1956)). In order to
establish entitlement to a deduction for gambling losses in this
Court, the taxpayer must prove the losses sustained during the
taxable year. Mack v. Commissioner, 429 F.2d 182 (6th Cir.
1970), affg. T.C. Memo. 1969-26; Stein v. Commissioner, 322 F.2d
78 (5th Cir. 1963), affg. T.C. Memo. 1962-19.
Petitioner failed to present credible evidence of gambling
losses beyond those respondent conceded. Petitioner did not
maintain a diary or any other contemporaneous record reflecting
2 This documentation consisted of casino ATM receipts,
canceled checks made payable to casinos, carbon copies of checks
made payable to casinos, and credit card statements stating that
cash was advanced at the casinos.
Page: Previous 1 2 3 4 5 6 Next
Last modified: March 27, 2008