Yet you have to turn inside out to deduct losses. We had an old guy who
came into the Hilton when they started the $100 slot machines. $300 a pull
if you played all three lines. He lost big time, yet along the way, he'd
win $10k here and $50k there, every time having to fill out an IRS form for
winnings over $1,000. Ended up, he lost all his money, and had a hefty IRS
bill, and could not deduct the losings. He was about 80, and his attitude
was, "What they gonna do, throw me in jail for the rest of my life?" Papers
got ahold of it, and it died a quiet death shortly after that. He probably
did, too.
Reminds me of the "day traders" of about 10 years or so ago. Big article
printed in the local paper in early April of 2000. There was a guy whose
brokerage account had about $10,000 in it yet he owed the IRS about
$250,000 in taxes from the profits that he made in 1999 on his day
trading. He would make a huge profit on one trade and then lose it all
on the next trade. But, the government didn't care. Profit is profit and
you could only claim $30,000 in losses at that time.
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