peers gone qualify as having a gauge in the activity is a trigger business because they lost then it is the same set of facts and grossly mr growth superhit less than successful results that does not make it any less of a trade or a business th department seems to hone in on this is that he said it was an entity that he and his wife enjoyed and certainly enjoying the name to be order right in her ration from it doesn't make it any less of a trade or a business i enjoy being here this morning i differently in just the usual month we saw but if you look at the amounts that were cycled through these machines in shoals a stream of time dedicated two hundred sixty nine trips to the grain victoria seen on the four year period during that time over four point seven million dollars were pumped into these dead takes a lot of time similarly the same time the hollywood has seen all though it was a trick number of times you're there four point seven million dollars home due to those huge it's so tall this nine point four million dollar cycle to these machines and at least in what i'd argue because the hollywood doesn't keep track of the number of times you're there you can compare the number draw is that anybody that is going to go in cycles through industry burbling testified that there was always a profit motive here you don't you know ball nine point four million dollars through a machine without  if you're there for fifteen hours or more on that cycle through doesn't equate to the type of explosive numbers that we see on the record in this case but you did to get your honest question yes if we could call that professional gamblers focus on the fact that they didn't follow the returns is if they were professional gamblers and they did a good singer but it didn't prohibit them from being in this fight is that when the supreme court made the decision in addition they the case of my ursus commission with the letters that were submitted in this case from the letters that were submitted in the context of the americans because the letters in this case say that these results do not show a i believe that there would be the only reasonable conclusion that the lower court made a mistake in determining that these testers you know paula as we gauge in a trade or business the fact that they kept over many one hundred fifty records to demonstrate th sixty thousand dollars plus interest on those losses ironically when we submitted the documents in discovery that showed the actual point in point out amended notices of deficiency were filed suggesting that these  affirm their decision which is reviewing of holding the nose deficiency for paid to illinois state income taxes relating to the i wasn't mumbling but i wasn't very loud either i urge the court to affirm that decision because the plaintiffs have not shown that they had the director as the administrative decision maker in this case either misapplied this statute or made findings of fact that are clearly erroneous or contrary to the manifest weight of the evidence or that any relevant statutes is unconstitutional either on his face or is applied to these plaintiffs and the heart of this case is the discrepancy between federal tax law and illinois tax law regarding the reporting of income from recreational gambling activities and the difference is has to do with sort of above the line in so called below the line treatment of expenses which would include duction is that something would seem to take from an activity an underlying distinction is sort of the core principle in federal income tax well that's adopted in state law and did considers a certain income to be related to the conduct of a trade or business and other income to be related to the hobbies and other recreational activities and the this distinction is relevant because the little one income tax  says that to report your income for purposes of illinois taxation subject only to a few statutory deductions you can take your adjusted gross income from your firm tax return and patchouli you carry over income when you pay three percent on a basically now the difference arises from the fact that of the federal income tax laws before you compute your adjusted gross income if you're in gauged in a trade or business you get to  that's what happened here in the directors finding that the birds were engaged in an expensive recreational hobby is well supported by the record and cannot be reversed under the appropriate standard of would tilt the skills towards finding there the person doing that was engaged in the trade or business of gambling was a professional gambler but again there's not one factor this dispositive it when i say tip the scales it's really probably you know one of these color mobile type things for each of the factors comes into play and they can balance accordingly and you get a pretty good intuitive sense after looking at the facts whether you think the person is engaged in a trade or business or is in fact just engaged in a hobby the purse who was you know was engaged in professional gambling activities i remember seeing johnny morris early the apprentice positive factor there is the fact that he has a different job or yet he makes a lot more money factors and concluded that first there was not a relevant issue because he was bound by constitutional statutes that say when you do clear your income is recreational income and your federal income tax returns that controls the issue and there's no way constitutional provision that says that's how the statutes can be constructed the stations are so constructed the road provisions of the income tax their sessions two of three and for all three make it clear you can't  pick how you you treat come expenses for federal income tax purposes and how you treat them for state income tax purposes in this case the birds to clear them selves as their federal income tax returns as not being professional gamblers all their good options were taken bowl all over the line they didn't fill out a schedule for business related gambling income they did none of the things that corresponded to what was necessary to be able to take their adjusted gross income figure from their federal income tax return interior door to their state income tax return and have their deductions be a ball line for federal income tax purposes and therefore permissible for computing what they're going from taxes i understand you correctly had the filed in federal return differently and came and suggested that they had two full time jobs in the case of this is for one full time job as a question and i want to answer this very precisely and i believe i have a footnote in my brief that is devoted to this it's not exactly a perfect a two way street here if i can use that metaphor but the standard here is that the tax paid tax payer cannot depart from what they've done on their federal income tax return which there is room however in the statute for  department of revenue in extreme cases to say that what you reported was not the amount that was improperly to be portable and a message to asian the director but not the taxpayer has the ability to say that there should be a different total but perhaps not absolutely total correspondence between the treatment of the federal income tax return for the taxpayer in question and their state income tax returns are you relying on so much on any testimony that  with respect to whether this was a hobby or income generating a job but you're looking at what was written on the federal return our primary reason is yes that the tax payers can't have taken one position on the f said they did it for amusement the record keeping was a shopping bag that type of thing he had a full time job making it four million dollars a year three out of the four years in question over two hundred thousand you know the fourth year thing when on the weekends they did occasionally go to los vegas they did none of the things that would be the hallmarks of a person truly indeed in the trade or business of gambling because for relevant purposes it's not enough just to sort of have a shopping bag and say for example well all my tim receipts here corresponding to money that i spend on leaders will be paid for food way how did you eat where did you stay how did you pay for that well not this in you know none of this income related to that there was testimony that the that the administrative law judge or the director wasn't required to cross it is being perfect proof that they had actually valid records which would be consistent with a type of record keeping for somebody gave them a trade or business the administrat a said you know essentially neither of you has a stale list any justification based upon compelling recordkeeping to apart from the income numbers that were reported on the federal income tax return which in any event i have to follow federal tax rule and that's exactly what the income tax does and it does so with a pretty tight if not you know ironclad grip saying and the cases are consistent with this you can't take one position with respect to your income on your federal income taxes and then take an inconsistent position with respect to state income taxes there's a we're here where the actual records from the casinos that the birds frequented the most true the actually had more in fact they were professional gamblers engaged in the trade or business they would have had so withholding income that they had to pay and that now their position is oh no we have all sorts of losses that we can prove that we had other gambling withholding income if they were engaged in the trade or business and gambling did they withhold no they did did they find those forms no they did did they report themselves as engaged in a trade or business and run those numbers to determine whether they were responsible for so withholding no  can our position is that this is largely a red herring that the law in no way doesn't allow taxpayers to sort of do this after the fact we'll figure out whether the position we took on a federal income tax returns was one was on our state income tax returns and you saw i want to take a different position for illinois in texas and realize here too that they move specifically to postpone the finale of the decision against them in this case so can look at one factor or another factor and say i enjoy it but there doesn't prevent me from being my business yes but it's some point you have to look at sort of the predominant purpose of what's going on and if the productive purposes income making activity then fine it falls into one category if the predominant purpose is enjoyment and recreation which is so often the case for many activities including most gamers then there is a legitimate determination to say that we can't have federal tax purposes in force finally given the way that our tax system works for state tax purposes it's essentially if you go to the trick there's a seventeen percent the sensually per usual calculation of what goes to the house pass rational basis yes it also does dovetails into whether or not the tacey seems arbitrary or on reasonable and just looking at the what the department did when they received these report ability for the government to apply in this case a should scheme and it does not rishon we relate to any legitimate definition of the income it does not relating to any legitimate fairness principle that would say that did see that leave to amend the returns that there is nothing that i've seen in any of the briefs or our events that suggests that these to experience would not be able to amended the thought all of you have a three year period if you're seeking a refund but they will be seeking a refund at business without it on file the problem returns just like the birds did without hearing it be a successful income just like the birds do not make any money off of this in the four year period and council also suggests and talks about well was never the lead in the court specifically says albeit unsuccessfully did it for profit you know unsuccessful is still trader business a lot of people who are engaged in trades or businesses go behavior because they don't make money at