The Internal Revenue Code contains a specific provision regulating income-tax deductions of gambling losses.
Under Section 165(d) of the Internal Revenue Code, losses from “wagering transactions” may be deducted to the extent of gains from gambling activities.
In Commissioner v. Groetzinger, the Supreme Court Justice Blackmun alludes to Section 165(d) which was a legislative attempt to close the door on suspected abuse of gambling loss deductions.
[8] Poker differs from many other forms of gambling as skilled players may increase their chances of winning significantly.
In the case Cohen v. The Queen judge ruled that the gambling activities were not conducted in sufficiently businesslike manner and thus the losses were not deductible.