Tax Memo #1/gambling Activities

Issues & Facts Dr. Green is a practicing physician in Chicago who, as an avid blackjack and slot machine player, travels to Las Vegas every take off weekend to gamble. He would like to know what criteria are practice to de stipulationine whether his gambling activities constitute a trade or commercial enterprise for federal income tax purposes and whether or not you speak up his gambling activities qualify for trade or byplay status. The base voice trade or short letter is drilld repeatedly throughout the ingrained revenue Code. Despite its regular use of that term the code or the Treasury Regulations do not ready that phase. It is up to the coquets to state the facts and mark the legal points. scour in the eyes of the court or the business solid ground the irresolution is whether an income-producing application constitutes a trade or business. The Internal Revenue Service has defined trade or business as an natural action carried on for livelihood or fo r profit. For an activity to be considered a business a profit reason essential be present and some type of sparing activity must be involved. It is distinguished from an activity prosecute in purely for personal satisfaction. In Valenti v. Commissioner, the court reiterated that dent 165(d) applies to skipper risk takers as well as amateurish gambler The court stated, ...

it has been held both by this Court and diverse courts of appeals that wagering losses cannot be deducted, except to the extent of the taxpayers gains from wagering activities, and it has been so held even where such activities were dem anded as a trade or business as contrary to! a hobby Therefore, for example, if a unpaid gambler visits a casino one Saturday and accumulates $600 of losses and $ two hundred of gains, that recreational gambler may deduct $200 of the losses. coda Since Dr Green does not conduct his gambling activities in the akin manner and with the same attentive to treat this activity as a profitable business as he does with his medical exam practice, nor does he need to...If you lack to get a amply essay, order it on our website: OrderCustomPaper.com

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