Gold Coast Hotel & Casino v. United States
Opinion
Lead Opinion
Whaley, J.
The United States of America and Commissioner of Internal Revenue appeal the district court’s grant of summary judgment in favor of Gold Coast Hotel & Casino, et al The district court held that a casino using the accrual method of accounting may deduct the value of slot club points won by a slot club member in the tax year in which the member has accumulated the minimum number of points necessary to redeem a prize. We affirm.
FACTUAL BACKGROUND
Gold Coast Hotel & Casino (“Gold Coast”) is a Nevada limited partnership formed in 1985 for the purpose of operating a licensed gambling casino in Las Vegas, Nevada. Gold Coast has operated a slot club sinee March 1987. A slot club is a promotional tool used to attract slot machine players. After filling out the necessary paperwork, slot club members receive a club card, similar to an ATM card. Slot club members insert their club cards into a slot machine and a computer tracks their accumulation of slot club points.
Slot club points can be redeemed for prizes ranging from coffee mugs to Hawaiian vacations. The minimum number of points needed to redeem a prize is 1,200. As stipulated to by the parties, the market value of each club point…