Court Tells Gambler, "You Gotta Know When To Fold Up."

In this case, the estate of a deceased gambler, tried to deduct gambling losses in excess of gambling winnings and also tried to deduct gambling business expenses.  The court, however, held that the gambler did not engage in gambling activities with the intent of making a profit.  The gambler had significant losses from gambling and reported them along with gambling winnings on Schedule C.  The gambler had significant losses for a five-year period, had no business plan, no budget for gambling activities, did not have a separate bank account for gambling activities, made no attempt to make gambling activities profitable, did not consult anyone with expertise in gambling and didn't operate gambling activities  in a businesslike manner.  The court imposed an accuracy-related penalty.  Estate of Chow v. Comr., T.C. Memo. 2014-49 .