T.C. Sum m ary Opi ni on 20 16 -7 3

UNITED STAT ES TAX COURT

PETER PHUONG K. PHAM AND BACH T. NGUY EN, Peti ti on ers v. COMM ISSI ONER OF INTERNAL REVENUE, Resp on de nt

Doc ke t No . 18 28 9- 15 S. Fi le d No ve m be r 8, 2 01 6.

Pet er Ph uo ng K. Pham

an d B ach T. Nguyen, p ro ses e. Han s Fa m

ul aro an d M in dy S. Meig s, fo r res po nd en t.

SUMM ARY OPINION PANUTHOS, Chi ef Sp eci al Trial Ju dg e: Thi s ca se was h eardpu rs ua ntto th e p ro vi si on s o f se ct io n 7 46 3 o f th e In te rn al Rev enue Co de ineffe ctwhen th e pe ti ti on was fi le d. Pur su an t t o s ect io n 7 46 3( b) , th e d eci si onto be en te redis no t 1
Unl es s o th erwi se in di cat ed , subs eque ntsec ti onrefe ren ces are t o the 1 (co nt in ue d...)2

rev ie wab le by any

ot he r co urt, an d thi s o pi ni on sh al l n otbe tre at edas p rece de nt fo r an y ot he r cas e. Ina no ti ce o f de fic ie nc y

date d Ap ril 20 , 20 15 , res po nd en t d et erm in eda de fic ie nc y

inpe ti ti on ers ’ Fed eral in co m e ta x o f $3 ,92 2 fo r ta x year 20 13 . After co nc es si on s, th e is su e fo r de ci si on is whet he r an d t o wh atex te ntpe ti ti on ers

2 in cu rredde du ct ib le ga m

bl in g l os se s.

Bac kg ro un d So m e o f th e fac ts ha ve be enst ip ul at ed , andwe in co rp or at e th e st ip ul at io n o f fact s b y th is refe ren ce. Pet it io ne rs res id edinCal ifo rn iawhen th e p et it io n was ti m el y fil ed . Pet er Ph uo ng K. Pham

(pe ti ti on er h us ba nd ) an d B ach T. Nguyen (p et it io ne r wife ) eac h wer e em

pl oyed b y El Dor ad o En te rp ris es d.b .a. Hus tl er Ca si no (Hus tl er Cas in o) as aho us e p lay er o r ho st(ho us e p lay er) dur in g p artof the y ear a t i ss ue . The pa rti es ag ree t ha t ca si no s s om et im es hi re h ou se pl ay ers to en su re tha t th ere a re en ou gh pl ay ers to st artan d m ai nt ai n c ardga m es or t o g ai n a n a dd it io na l (...co nt inue d) 1 In te rn al Rev enue Co de (Co de ) in effe ctforth e y ear i n i ss ue , andall Ru le refe ren ces are t o t he Tax C ou rt Rul es of P ract ic e an d P ro cedur e. Pet it io ne rs co nc ed e th atth ey rece iv ed$1 6,8 00 of unr ep orte d g am bl in g 2 win ni ng s i nc om e in20 13 .3

so ur ce o f rev enue fro m

th e p lay er’s win ni ng s. Pet it io ne rs ex pl ai ne d t ha t as ho us e 3 pl ay ers for

Hus tl er Ca si no th ey

wou ldst arta ga m e o f “ Tex as Hol d ‘Em ” p ok er (Tex as Hol d ‘Em). The g oa l was to att ractot he r pl ay ers /c us to m ers . Peti ti on ers each rece iv edanho ur ly w ag e. 4 Pet it io ne rs furth er ex pl ai ne d t ha t the y were re qu ire d b y

Hus tl er Ca si no to us e th ei r own fun ds forbe tt in g i n t he ga m es of p ok er, i nc lu di ng pa y in g t he same tabl e fee s as cu st om ers no t em pl oyed b y th atcas in o. Th e tabl e fee s i nc lu de d a reg ul ar t ab le fee o f $5 pe r handan d aco ll ect io n fo r a “ba d b eatjackp ot ”, whi ch was $1 pe r ha nd . Hus tl er Ca si no setasi de on e d ol lar fro m each handforth e b ad be atjackp ot . Und er ce rta incir cu m st an ces no t d es cri be d i n t hi s re co rd , Hus tl er Cas in o wo ul d d eci de th ata pl ay er h ad“hi t the jackp ot ”. Hus tl er Ca si no wou ld

The pa rti es st ip ul at eda co py of a p rin to utfro m th e Po ke rZon e Web si te 3 whi chpro vi de s the fol lo win g d efi ni ti on of aho us e p lay er: “ A[n ] pl ay er wh o i s em pl oyed b y th e cas in o o r car dr oo m ; a p ro po si ti on pl ay er, s take pl ay er, o r sh il l * * * [c ]ardro om s s om et im es em pl oy ho us e p lay ers inord er t o e ns ur e th atth ere are e no ug h p lay ers to st artan d m ai nt ai n g am es or t o g ai n a n a dd it io na l s ou rce o f rev enue fro m

th e p lay er’s win ni ng s.” Pet it io ne rs ass ert edat t ria l tha t the y be li ev e th ey

were p ai d $ 15 pe r ho urin 4 20 13 .4

th enred is tri bu te th e acc um ul at edba d b eatjackp otfun ds to th e win ne r of th at jack po t. 5 Pet it io ne rs est im at e th atth ey each pl ay edsi x h ou rs pe r day , 21 day s a m on th , forsev enm on th s i n 2 01 3. Pe ti ti on ers bro ug htth ei r own fun ds to pl ay po ke r eac h d ay . Whe n p et it io ne rs won , th ey wou ldrece iv e ch ip s fr om Hus tl er Cas in o. Th ey

us edch ip s fo r fu rth er g am bl in g o r cas he d the m

in . Peti ti on ers as se rt t ha t Hu st le r Cas in o d idno t re im bu rs e th em

fortab le fees , badbe atjackp ot fees , or g am

bl in g l os se s i nc urredinth ei r res pe ct iv e ro le s as ho us e p lay ers . Pet it io ne rs ass ertth atin it ia ll y th ey tri edto ke ep tra ck

of t he ir p ok er wi nn in gs an d lo ss es by writ in g d ownth e am ou ntwonor l os t atth e en d o f eac h d ay , bu t af te r a whi le th ey

ga ve up th atpra ct ic e b ecau se itis “ba d fo r y ou r ps y ch e * * * y oune ed to be stro ng m en ta ll y ” whe n p lay in g c ard s. Hus tl er Ca si no di d n ottra in pe ti ti on ers to pl ay po ke r, no r di d i t re qu ire th em to pa ss anex am

rel at in g t o the ir p ok er s ki ll s i n o rd er t o b e h ire d a s h ou se pl ay ers ; in st eadth ey

were h ire d t o s itat p ok er t ab le s an d p lay card s. Acco rd in g t o The pa rti es als o s ti pu la te d aco py of th e la w enf or cem en t ad vi so ry

fro m th e 5 Cal ifo rn iaDiv is io n o f Gam bl in g C on tro l d at edMay 24, 1 99 9, t it le d “ Ja ck po t Po ke r”. Thi s ad vi so ry

de sc rib es ho w jackp otpo ke r ga m es in vo lv e h av in g afix ed su m of m on ey

withd rawnat e ach ga m e an d p la cedin to th e jack po t fu nd . W

he n a pa rti cu lar co m

bi na ti on of c ard s i s ac hi ev ed , th e p lay er wi th th atha ndwin s al l the fund s i n t he jackp ot . The ad vi so ry als o m en ti on s tha t “ [s ]om e v ari at io ns in cl ud e” ba d b eatjackp ot s.5

pe ti ti on ers , Hus tl er Ca si no want edpl ay ers who wou ldlo okne atan d m ak e a g oo d ap pe aran ce fo r th e g am e. Pet it io ne rs ass ert edat t ria l tha t Hu st le r Cas in o wo ul d no t h ire “pr of

es si on al ga m

bl ers ” b ecau se su chpe rs on s wo ul d wi n t oo m uc h a nd co ul d n otbe tru st ed . Pet it io ne rs to ge th er re cei ve d $ 16 ,80 0 i n g am bl in g wi nn in gs fro m

Hus tl er Cas in o a s h ou se pl ay ers in20 13 . Occas io na ll y pe ti ti on ers ga m

bl edat o th er cas in os . In Oct ob er 2 01 3 p et it io ne rs won$6 ,60 0 fr om Co m m erce Cas in o. Pet it io ne rs ’ gam

bl in g a ct iv ity

at C omm erce Cas in o was recr eat io na l, an d t he y were n otho us e p lay ers th ere. Pet it io ne rs res ig ne d fr om th ei r po si ti on s as ho us e p lay ers forHus tl er Ca si no in Ju ly 201 3. Pe ti ti on ers ’ in co m e fo r 20 13 co ns is te d o f wag es fro m Hus tl er Cas in o, g am

bl in g wi nn in gs fro m

bo th Hus tl er Ca si no an d C omm erce Cas in o, an d a Cal ifo rn iaSta te in co m e ta x re fund . Sin ce re si gn in g fr om th ei r po si ti on s at Hus tl er Ca si no , pet it io ne r hu sb an d h as ret ire d a ndrece iv es So ci al Secu rit y be ne fit s wh il e p et it io ne r wife pe rfo rm s o ddjob s. Pet it io ne rs ti m el y

fil eda joi ntFo rm

10 40 , U.S. Ind iv idua l In co m e Tax Return, fo r 20 13 . On th ei r Fo rm 10 40 th ey

rep orte d $ 15 ,40 2 i n t ot al wage in co m e ($ 6,6 41 forpe ti ti on er h us bandan d $ 8,6 71 forpe ti ti on er wi fe) fr om Hus tl er Ca si no an d t he $6 ,60 0 o f ga m

bl in g wi nn in gs fro m

Co m m erce Cas in o. Pe ti ti on ers6

rece iv eda Fo rm

10 99 -MI SC, Mi sc el lane ou s In co m e, fro m Co m m erce Cas in o is su edto pe ti ti on er wi fe re fle ct in g t he $6 ,60 0 i n g am bl in g wi nn in gs . Peti ti on ers al so rece iv eda Fo rm

W -2 G, Cert ai n Gam

bl in g Win ni ng s, i ss ue d t o p et it io ne r wife fo r th e $ 16 ,80 0 i n wi nn in gs fro m Hus tl er Ca si no . Peti ti on ers di d n otrep ort the $1 6,8 00 on th ei r Fo rm

10 40 . Peti ti on ers cla im eda st an da rdde du ct io n o f $1 3,4 00 . Res po nd en t i ss ue d the no ti ce o f de fic ie nc y in cl ud in g the $1 6,8 00 in ga m bl in g wi nn in gs fro m

Hus tl er Ca si no inpe ti ti on ers ’ ta xabl e in co m e fo r 20 13 . Pet it io ne rs ti m el y

fil eda pe ti ti onass ert in g t ha t the y di d n otrep ort thi s i nc om e be cau se th ei r gam

bl in g l os se s as ho us e p lay ers at Hu st le r Cas in o e xc eed edth ei r ga m bl in g wi nn in gs . Peti ti on ers ass ertth atth ey were fo rcedto res ig n fr om th ei r po si ti on s as ho us e p lay ers inJu ly 201 3 fo r th is reas on . Peti ti on ers est im at e th at th ey ha d e ach lo st$1 ,00 0 p er m on th forsev enm on th s o n Tex as Hol d ’Em ga m es pl ay edinth ei r ro le s as ho us e p lay ers . They al so ass ertth atth ey pa idanest im at ed $7 ,05 6 i nt o t he ba d b eatjackp otan d t ha t the ir g am bl in g l os se s t ot al ed$2 1,0 56 . 6 Pet it io ne rs ha ve no t p ro vi de d a ny recei pt s o r ot he r do cu m en ta ti on of t he se fees or lo ss es . Pet it io ne rs est im at e th atHus tl er Ca si no co ll ect s o n a ve rag e $ 4 p er p lay er

6 pe r ho ur inba d b eatjackp otfees . There fo re, $ 4 p er h ou r × s ix ho ur s p er d ay × 21 da y s p er m on th × se ve n m on th s × two ho us e p lay ers = $7 ,05 6 i n b adbe atjackp ot fees .7 Dis cu ss io n I. Bu rd enof P ro of Inge ne ral , th e Co m

m is si on er’s d et erm in at io n s etforthina no ti ce o f de fic ie nc y

is pre su m edco rrec t, an d the tax pa y er b ears th e b ur de n o f pr ov in g t ha t th e d et erm in at io n i s i n e rro r. Ru le 14 2( a); W el chv. Hel ve rin g, 2 90 U.S. 11 1, 1 15 (1 93 3) . Purs ua ntto sec ti on 74 91 (a), the bu rd enof p ro of as t o fa ctua l m at te rs sh ift s t o t he Co m

m is si on er u nd er ce rta in cir cu m st an ces . Peti ti on ers di d n otall eg e orot he rwis e sh ow tha t s ect io n 7 49 1( a) ap pl ie s an d h av e n otsh own th atth ey are i n co m pl ianc e wit h t he subs tant ia ti on an d re co rdke ep in g re qu ire m en ts of t ha t se ct io n. Se e se c. 74 91 (a)( 2) (A) an d (B ). Ther efo re, p et it io ne rs be ar the bu rd enof pr oo f. See Ru le 14 2( a). Inun rep orte d i nc om e cas es , th e Co m m is si on er m

us t b as e th e d efi ci en cy

on so m e subs tant iv e ev id en ce tha t the tax pay er re cei ve d u nr ep orte d i nc om e. Hardy v. Co m m is si on er, 1 81 F.3d10 02 , 10 04 (9t h C ir. 1 99 9) , aff’g T.C. Mem o. 1 99 7- 97 ; Rap p v . Comm is si on er, 7 74 F.2d93 2, 9 35 (9th C ir. 1 98 5) . If th e Co m m is si on er in tro du ces so m e ev id en ce tha t the tax pa y er re cei ve d unr ep orte d i nc om e, th e bu rd ensh ift s t o t he tax pa y er. Hardy v. Co m mis si on er, 1 81 F.3dat 1 00 4; Rap p v . Co m m is si on er, 7 74 F.2dat 9 35 . The p art ie s s ti pu la te d aFo rm W -2 G is su edby Hus tl er Ca si no , andpe ti ti on ers adm it te d t o re cei vi ng th e g am bl in g wi nn in gs .8

Si nc e p et it io ne rs ackno wled ge rece ip t the on ly iss ue be fo re u s i s wh ethe r th ey are en ti tl edto de du ct io ns for ga m bl in g l os se s. See Hardy

v. Co m m is si on er, 1 81 F.3d at10 04 ; Rapp v. Co m

mis si on er, 7 74 F.2dat 9 35 . II. Gam

bl in g Win ni ng s an d Lo ss es Gro ss in co m e in cl ud es all in co m e fro m what ev er s ource d eri ve d, i nc lu di ng ga m bl in g. Se e se c. 61 ; M cCl an ah anv. Un it edSta te s, 2 92 F.2d63 0, 6 31 -6 32 (5t h Ci r. 19 61 ). Taxp ay ers who are “pr of es si on al ga m

bl ers ” en ga ge d i n t he tra de or bu si ne ss of g am

bl in g m ay

de du ctth ei r ga m

bl in g l os se s up t o t he am ou nt s o f th ei r ga in s t o a rri ve at a dju st edgro ss in co m e. See s ecs . 61 (a)( 1) , 16 5( d) ; Bo ne pa rte v. Co m m is si on er, T.C. Mem o. 2 01 5- 12 8. Inth e cas e o f ta xp ay ers no t en ga ge d i n t he tra de or b us in es s o f ga m

bl in g, s uc h l os se s ar e al lo wab le as a n i te m iz edde du ct io n, bu t o nl y to th e ex te ntof g ai ns fro m ga m bl in g t ran sa ct io ns . Sec. 1 65 (d ); McC lana ha n, 2 92 F.2dat 6 32 . Sect io n 1 62 (a) a ll ows as ade du ct io n a ll ord in ary an d n eces sa ry ex pe ns es pa idor i nc urredincarry in g o n a ny acti vi ty tha t co ns ti tu te s a t rad e o r bu si ne ss . An in di vi du al m ay

be inth e tr ad e o r bu si ne ss of b ei ng anem pl oyee. Prim

ut h v . Co m m is si on er, 5 4 T.C. 3 74 , 37 7 (1 97 0) . A tax pa y er em pl oyee cande du ct bu si ne ss ex pe ns es if h e can pro ve he was n oteli gi bl e fo r rei m bu rs em en t b y

hi s em pl oyer an d was no t re im

bu rs ed . Heid t v . Comm is si on er, 2 74 F.2d25 , 26 (7t h9

Ci r. 19 59 ), aff’g T.C. Me m o. 1 95 9- 31 . Unrei m bu rs edem

pl oyee ex pe ns es are de du ct ib le as m is cel lane ou s i te m iz edde du ct io ns on Sch edul e A, Ite m iz ed Deduc ti on s, t o t he ex te ntsu chexpe ns es ex ceed2% o f th e in di vi du al ’s adju st ed gr os s i nc om e. Secs . 62 (a)( 2) , 63 (a), (d ), 67 (a) and(b) , 16 2( a). If anex pe ns e can be co ns id eredeit he r a g am bl in g l os s und er s ect io n 1 65 (d ) ora bu si ne ss expe ns e und er s ect io n 1 62 , sec ti on 16 5( d) as the m or e sp eci fic st atut e co nt ro ls . Boyd v. Un it edSta te s, 7 62 F.2d13 69 , 13 72 -1 37 3 (9 th Cir . 19 85 ). Whi le pe ti ti on ers were em pl oyees o f Hus tl er Ca si no an d wer e p ai d asal ary to pl ay card s atth e p ok er t ab le , we m ig htals o v ie w th em as i nd ep en de nt co nt ract or s t o t he ex te ntth atth ey ga m bl edwith the ir o wn fu nd s, re ta in edth ei r win ni ng s, an d abs orbe d t he ir l os se s. Re ga rd le ss of wh ethe r pe ti ti on ers were em pl oyees o r in de pe nd en t co nt ract or s, the y were en ga ge d i n aga m

bl in g a ct iv ity an d a re re qu ire d t o s ub st an ti at e th ei r rep orte d g am bl in g l os se s. See Mac k v . Co m m is si on er, 4 29 F.2d18 2, 1 84 (6t h C ir. 1 97 0) , aff’g T.C. Mem o. 1 96 9- 26 ; s ee al so Mayer v. Co m

m is si on er, T.C. Mem o. 2 00 0- 29 5, af f’d, 29 F. App ’x 70 6 (2 d Ci r. 20 02 ). Acco rd in gl y

we fir stlo okto th e is su e o f whe th er p et it io ne rs subs tant ia te d t he ir r ep orte d g am bl in g l os se s.10

Deduc ti on s an d c red it s ar e a m at te r of leg is la ti ve gra ce, an d t ax pa y ers m us t pr ov e en ti tl em en t t o t he de du ct io ns an d c red it s cl ai m ed . Rul e 1 42 (a); INDOPCO, In c. v. Co m

m is si on er, 5 03 U.S. 79 , 84 (19 92 ); LaP oi ntv. Co m m is si on er, 9 4 T.C. 73 3, 7 36 -7 37 (19 90 ). Taxp ay ers are re qu ire d t o i de nt ify eachde du ct io n, s ho w th atth ey have m etall requi rem en ts , andke ep bo ok s o r rec or ds to subs tant ia te it em s u nd erl y in g a ll cla im edde du ct io ns . Sec. 6 00 1; Ro be rts v. Co m mis si on er, 6 2 T.C. 83 4, 8 36 -8 37 (19 74 ); s ec. 1 .60 01 -1 (a), In co m e Tax Reg s. To est ab li sh en ti tl em en t t o ade du ct io n fo r gam bl in g l os se s the tax pa y er m us t p ro ve th e lo ss es su st ai ne d dur in g t he tax ab le y ear. Ma ckv. Co m m is si on er, 4 29 F.2dat 1 84 ; s ee al so Mayer v. Co m

m is si on er, T.C. Mem o. 2 00 0- 29 5. Th e Co m m is si on er h as su gg es te d t ha t g am

bl ers reg ul arl y

m ai nt ai n adi ary, supp le m en te d b y ve rif iabl e do cu m en ta ti on , of g am

bl in g wi nn in gs an d l os se s. See Rev . Pro c. 77 -2 9, 1 97 7- 2 C.B. 5 38 . A taxpa y er’s “ co nt en ti on th atitwas t oo di ffi cu ltforhi m to m ai nt ai n co nt em po ran eo us reco rd s o f hi s g am bl in g a ct iv it ie s i s wi th ou t m eri t.” Kal is chv. Co m m is si on er, T.C. Mem o. 1 98 6- 54 1, 5 2 T.C.M . (CCH) 9 91 , 99 5 (1 98 7) ; s ee al so Sch oo le r v. C ommis si on er, 6 8 T.C. 8 67 , 87 0- 87 1 (1 97 7) . Whe n atax pay er es tabl is he s tha t h e p ai d o r in cu rreda de du ct ib le ex pe ns e bu t d oe s n otest ab li sh th e am ou ntof t he ex pe ns e, we m ay est im at e th e am ou nt al lo wab le inso m e ci rcu m st an ces . Coh anv. Co m m is si on er, 3 9 F .2d54 0 (2 d C ir.11

19 30 ). In o rd er fo r th e Co urt t o e st im at e th e am ountof t he ex pe ns e, th e Co urt m us t h av e so m e b as is up onwhi chanest im at e canbe m ad e. See Will iam s v . Uni te d S tate s, 2 45 F.2d55 9, 5 60 (5t h C ir. 1 95 7) ; Van ic ekv. Co m m is si on er, 8 5 T.C. 73 1, 7 43 (19 85 ). In e st im at in g t he am ou ntall owabl e th e Co urt b ears he av il y up on th e ta xp ay er wh o fa il edto m ai nt ai n re qu ire d re co rd s an d t o s ub st an ti at e ex pe ns es as t he Co de requi res . See Co ha n v . Comm is si on er, 3 9 F .2dat 5 44 ; Keen anv. Co m

m is si on er, T.C. Mem o. 2 00 6- 45 , aff’d, 2 33 F. App ’x 71 9 (9 th Cir . 20 07 ). W e h av e h el d t ha t wh ere atax pa y er fa il edto ke ep a reco rdof e ithe r win ni ng s o r lo ss es fro m

ga m bl in g a nddi d n otot he rwis e h av e ev id en ce o f lo ss es , he co ul d n otde du ctga m

bl in g l os se s. Sch oo le r v. C omm is si on er, 6 8 T.C. at87 1. The Co urt h as est im at edga m bl in g l os se s u si ng th e te stsetforthinCo ha n i n a li mit edsi tu at io n i n wh ic h t he tax pa y er d idno t p ro vi de reco rd s o f ga m bl in g wi ns an d l os se s b utdi d p ro vi de ev id en ce o f hi s m od es t i nc om e an d l ife st y le an d c op ie s of hi s b an k d ep os it s an d d is bu rs em en ts . Doffi n v . Comm is si on er, T.C. Mem o. 19 91 -1 14 , 61 T.C.M. (CCH) 2 15 7, 2 16 1- 21 62 (19 91 ); s ee al so Jo ne s v . Co m m is si on er, T.C. Mem o. 2 01 1- 77 , 20 11 W L 12 35 22 8, at*2 . The Co urt was12

ab le to est im at e th e ta xp ay er’s l os se s o n t he ba si s o f th is ev id en ce, wh ic h co rro bo rat edhi s t es ti m on y . Doffi n v . Commis si on er, 6 1 T.C.M . (CCH) at21 61
- 21 62 . Pet it io ne rs ass ertth atth ey in cu rred$1 4,0 00 inTexa s Ho ld‘ Em po ke r ga m bl in g l os se s i n 2 01 3 o n t he ba si s o f th ei r es ti m at e th atth ey each lo st$1 ,00 0 pe r m on th ov er a s ev en -m on th pe rio d, b utth ey di d n otpro vi de an y

do cu m en ta ti on orot he r pr oo f to supp ort the ir e st im at edlo ss es . Peti ti on ers als o a ss ertth ey in cu rred$7 ,05 6 i n g am

bl in g l os se s, es ti m at edfro m th e $ 1- pe r-h an d fe es forth e ba d b eatjackp otan d t he nu m be r of ho ur s the y

work ed . Pet it io ne rs ha ve no t p ro vi de d e vi de nc e o f th ei r lo ss es , su chas ape rs on al lo g o f da il y

win ni ng s an d l os se s, wi n/ lo ss st at em en ts , or b an k re co rd s. Altho ug h pe ti ti on ers ha d am od es t i nc om e in 20 13 , th ey di d n otpro vi de tes ti m on y or o th er ev id en ce attri al to co rro bo rat e th e cl ai m edlo ss es . See J on es v. Co m m is si on er, 20 11 W L 12 35 22 8, at*2 ; Do ffi n v . Comm is si on er, 6 1 T.C.M . (CCH) at21 61
- 21 62 . Furt he r, we are n otsat is fie d wi th pe ti ti on ers ’ as se rti on th atitwas t oo di ffi cu ltto m ai nt ai n t he ir l og do cu m en ti ng th ei r ga m bl in g wi nn in gs an d l os se s. See S ch oo le r v. C omm is si on er, 6 8 T.C. at87 0- 87 1; Kali sc h v . Comm is si on er, 5 2 T.C.M. (CC H) at99 5; Rev . Pro c. 77 -2 9, s up ra. Pet it io ne rs fai le d t o m ai nt ai n t he requi redtax reco rd s an d h av e fai le d t o p ro vi de th e Co urt wi th a ba si s upo n wh ic h13

th ei r ga m bl in g l os se s fo r th e y ear a t i ss ue co ul d b e es ti m at ed . See Will ia m s, 2 45 7 F.2 d a t 5 59 ; Co ha n v . Comm is si on er, 3 9 F .2dat 5 44 ; Van ic ekv. Co m m is si on er, 85 T.C. at 7 43 ; Kee na n v . Comm is si on er, T.C. Mem o. 2 00 6- 45 . W e h av e co ns id eredall of t he pa rti es ’ arg um en ts , and , to th e ex te ntno t ad dr es se d h erei n, we co nc lu de th atth ey are m oo t, i rrel ev an t, o r witho utm eri t. To re fle ctth e fo reg oi ng , Deci si on wil l b e en te red fo r res po nd en t.

W e n ot e th atpe ti ti on ers di d n otfil e a Sch edul e C, Pro fitor Lo ss Fro m 7 Bu si ne ss , to rep ort the ir g am bl in g wi nn in gs an d l os se s, n ordi d the y cla im th at th ey were “pr of

es si on al ga m

bl ers ”. Co ns eque nt ly, an y all owabl e g am

bl in g l os s de du ct io n c ou ldbe cla im edas a n i te m iz edde du ct io n. Se e se c. 16 5( d) ; McC lana ha n v . Uni te d S ta te s, 2 92 F.2d63 0, 6 32 (5th C ir. 1 96 1) . The Co urt fo un d pe ti ti on ers ’ te st im on y

est im at in g t he am ou ntof b adbe atjackp otfees , $7 ,05 6, cred ib le . For thi s re as on th e Co urt co ns id eredall owi ng pe ti ti on ers a gam bl in g lo ss de du ct io n o f $7 ,05 6. Se e Co han v . Comm is si on er, 3 9 F .2d54 0 (2 d C ir. 19 30 ). Becaus e p et it io ne rs ’ st an da rdde du ct io n fo r 20 13 , $1 3,4 00 , far ex ceed s th is am ou nt , su chanall owa nc e wou ldno t b en efi t p et it io ne rs ’ bo tt om li ne of t ax du e.