Cohen v. The Queen, 2011 DTC 1195 [at at 1080], 2011 TCC 262 -- summary under Business Source/Reasonable Expectation of Profit

By services, 28 November, 2015

The taxpayer attempted to claim $121,991 in poker losses on the basis that his gambling was a commercial activity. Pizzitelli J. found that the losses should be disallowed. He stated (at para. 41):

The only evidence is that he lost money, consistently throughout the year, and he has not demonstrated the venture has a capacity to show a profit.

Evidence demonstrated that the taxpayer lacked any formal or otherwise meaningful poker training, had no business plan, lacked discipline (he abandoned his strategy of playing low-stakes games against inebriated players after three months, to his detriment), failed to manage risk (he maxed out his credit cards to cover the losses), and had a personal element (he had been a hobby player for years) - all these factors contradicted there being a reasonable expectation of profit.

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