Ali and Arlene Mohammadpour - Page 8
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Also in contrast to the taxpayer in Commissioner v.
Groetzinger, supra, petitioners did not keep reliable records of
Mr. Mohammadpour’s gambling activity. This was due in part to
error,7 and also to the fact that Mr. Mohammadpour intentionally
ignored, for record-keeping purposes, bets on which he won less
than $600 and which therefore were not reported to the IRS by
means of Form W-2G. These winning bets of less than $600 made up
approximately 10 percent of all Mr. Mohammadpour’s bets. In
other words, petitioners adopted record-keeping practices which
would merely approximate Mr. Mohammadpour’s gambling performance.
Such is inconsistent with a conclusion that Mr. Mohammadpour
engaged in his gambling activity with the primary purpose of
making a profit. As we found in Calvao v. Commissioner, supra:
“[P]etitioner’s efforts * * * are consistent with the desire to
win money * * *. However, we find petitioner’s desire to win
money and his strategy for doing so is also consistent with
gambling purely for its entertainment or recreational aspects.”
On the record before us, we are unable to conclude that Mr.
Mohammadpour’s gambling activity was a trade or business. Even
“Attorney/Handicapper” and “Attorney/Greyhound Racing Wagerer”,
reported $20,373 of net income from his gambling activity and
$20,550 from his business as an attorney.
7Mr. Mohammadpour testified that in preparing petitioners’
2003 return he overlooked some records of winnings and “we did
not account for the recent amounts of perhaps no more than
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Last modified: November 10, 2007