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Gambler wins his biggest bet yet
December 04, 2009
A compulsive gambler whose betting records disappeared with his tax preparer was allowed his gambling losses anyway in Tax Court yesterday. The court reviewed the record, decided the guy was a compulsive gambler and a sad sack, and that he surely blew more at the track than he won. The court almost certainly got it right.
Still, it took a trip to Tax Court to win this battle. As gambling tax maven Russ Fox points out:
Do note that it is far easier to win at an audit if you have contemporaneous records, and you usually won’t need to go through the expense of a case at Tax Court.
Cite: Caro, T.C. Summary Opinion 2009-184
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Comments
Based on reading the opinion, it appears to me that the taxpayer's biggest problem was his choice of preparer, not his failure to keep records. See the following excerpt from the opinion:
"Petitioner provided all of his daily programs and tax records for 2006 to his return preparer. The return preparer made several mathematical and computational errors on petitioner’s tax return for 2006. The return preparer incorrectly reported petitioner’s gambling income and itemized
deductions, including his gambling losses. The return preparer never returned petitioner’s records for 2006 despite petitioner’s repeated requests. He has not yet been able to contact or locate the return preparer, who provided no forwarding information when he left the area."
It would be interesting to know the name of the return preparer, but unfortunately the Tax Court opinion does not list it.
Posted by: Mary O'Keeffe | December 4, 2009 8:04 AM