Claiming Win/Loss to the IRS

[Ed S.]

I am told that technically you are supposed to claim everything. But I was also told that the IRS really doesn't worry about it until $5,000 dollars and more. Question to the pro's and Semi-Pro's. How do you guys/gals claim your Win/Loss and what steps do you take to ensure an accurate account and that it is legit for the IRS?

Any and all comments would be greatly appriciated. Since I will be jumping back into the game at the end of the month and to play it on a Semi-Pro level.


Thanks.


Ed S.

[cero_z]

This may be a stupid question, but I will play primarily in a private game, the legality of which falls into a gray area, but in any case I would not want to call attention to it. Do any of you declare earnings from non-cardroom games?

[Homer]

no one ever answers these questions. i posted a similar question a few months ago that got like 4 views and no responses....so good luck.

-- Homer

[Easy E]

Then again, I'm not a semi-pro...

I claim it all- B&M, home games, etc. Whether or not there's a threshold to worry about, I don't want to get really lucky one year and have the IRS say "where did all of these losses come from?"

I started filing after reading an article about a Texas judge a few years back that got nailed for filing only when he won for the year

[balt999]

Most recreational players don't claim their winnings on their taxes..so their not aware of the tax laws regarding gambling winnings..

My advice is to talk to an accountant or a tax lawyer..

[B-Man]

I am not a tax lawyer, so you should consult with an accountant or professional rather than take advice from random people like me on the internet... That being said, here is my understanding:

1. By law, you have to report ALL winnings as income (there is no $5,000 floor).

2. For federal income tax purposes, you may deduct gambling losses against your wins.

3. For state income tax purposes, you need to check your own state law. In Massachusetts, for example, you can NOT offset gambling losses against wins. This is a pretty harsh rule (but not surprising for The People's Republic of Massachusetts).

4. You should keep detailed records of the result of each session, i.e. a gambling "diary." This is your backup if the IRS ever audits you. If you don't keep good records and you get audited, you are going to have a problem.

Now, as for whether winning players actually comply with the above and report all their winnings from cash games, I have no idea. I would suspect, based on human nature, that there is a great deal of cheating going on, since winnings from cash games are not tracked or reported. I would be very curious to know how many people report every dollar.

[Ryan_21]

So what the f are you suppose to do if you dont keep records? You cant exactly claim anything if you arent sure about how much you win or lose?

Ryan_21

[B-Man]

Start keeping a diary right away if you want to comply with the law going forward.

I realize that doesn't help you for last year. I'm not sure what to tell you, if you won money, you are supposed to report it, and you are supposed to keep records so you have evidence you are reporting all of it and only deducting actual losses.

[whiskeytown]

Ed...I posted much of the same question in the tournaments page cause that's where my winnings/1099's are from...Fossilman answered it pretty well...

http://www.twoplustwo.com/forums/showthreaded.php?Cat=&Board=tourn&Number=204868&pa ge=0&view=collapsed&sb=5&o=14&fpart=1

basically, to summarize...prepare to take it up the ass with a barbed wire condom....[censored] Federal Government tax rules. Poker players need to form a multinational corporation and donate some money to PAC's so we can get all the tax breaks like they do....sheeeit

RB /forums/images/icons/mad.gif /forums/images/icons/mad.gif /forums/images/icons/mad.gif /forums/images/icons/mad.gif

[Ed S.]

Thanks whiskey that helped out alot and thanks all, it was all good info that I need.


Ed S.