Linda M. Myers - Page 12




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          casino and studying their patterns to determine which slot                  
          machines were likely to pay out.  Moreover, petitioner testified            
          that after some initial losses she changed her strategy to help             
          her win.  She decided to try to win just a little at a time                 
          rather than to try to recoup old losses all at once.  See Engdahl           
          v. Commissioner, supra at 669.  If petitioner won some money                
          early in the day, she would take the winnings and return home,              
          rather than continue to gamble with the money she had just won              
          and risk losing it.  We find that this factor favors petitioner.            
          Expertise of Taxpayer or His or Her Advisers                                
               We next consider petitioner’s expertise (or the expertise of           
          her advisers) in the gambling activity.  Preparing for the                  
          activity by extensive study of its accepted business, economic,             
          and scientific practices, and consulting with experts in these              
          matters may indicate that a taxpayer has a profit objective when            
          the taxpayer follows that advice.  Sec. 1.183-2(b)(2), Income Tax           
          Regs.                                                                       
               Petitioner considers herself a gambling expert and has                 
          gambled for over 10 years.  The continuity and regularity of her            
          gambling activity strongly suggest that she is an expert at slot            
          machines.  Petitioner also consulted regularly with casino                  
          employees to further her gambling strategy and watched other                
          gamblers to understand what she believed to be slot machine                 
          payout patterns.  We find that this factor favors petitioner.               









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