Collins v. Commissioner

Collins (plaintiff), an employee of an off-track betting parlor, placed $80,280 worth of bets for himself without paying, ending the day with $42,175 in winning tickets, and pleaded guilty to grand larceny for the theft; the IRS (defendant) taxed the full $80,280 stolen amount, and the tax court affirmed the assessment. Collins appealed, apparently arguing his net losses (roughly $38,105) rather than the full stolen amount should have been taxed.