Commissioner v. Groetzinger
United States Supreme Court
480 U.S. 23 (1987)
Groetzinger (plaintiff) devoted 60 to 80 hours a week to gambling on dog races as his sole livelihood, and suffered a net gambling loss in 1978; the Commissioner (defendant) determined a portion of his losses were subject to the alternative minimum tax as a preference item unless his gambling qualified as a genuine trade or business, and the Tax Court and court of appeals both ruled his gambling was a trade or business exempting the losses from that treatment.
Whether a federal taxpayer's expenses are tax deductible if they arise from a trade or business that the taxpayer conducts primarily for income or profit, and not from an activity in which the taxpayer engages sporadically, or as a hobby, or for amusement.