taxes on ur winnings

[Jdiddy]

does anyone know how taxes work when cashing out large sums of money from internet gambling sites ?(pokerstars for me)

[Nigel]

Same as they work when not cashing out large sums of money.

[grinin]

You will get paid the full amount.

It is up to you to declare your winnings on your taxes when you win them (not just when you withdraw).

If you are regularly making money while gambling you are also supposed to be filing quarterly estimated tax payments rather than waiting until April 15.

[benkath1]

Have you ever recieved a W2G? I've been talking to my accountant and he said if you don't get any documentation from the sit not to worry.

I'm not giving advice!! Just curious.

[Nigel]

lol, that's some accountant you got there.

[grinin]

Your accountant is a moron.

You will not get a W2G from any of these sites. They are all offshore and do not report to the US.
Thus it is your responsibility to report your winnings.

Now back to your accountant. He should have said "If you have minimal earnings that you fail to report it will most likely not raise any red flags. If, on the other hand, you are regularly recieving funds from some source, even though they do not report to the feds, there will still be a paper trail of these funds that could arouse some suspicions. Additionally, if perchance you were ever involved in an audit there is a 95% chance that they would ask you where this money came from"

[smb394]

And you should also be paying quarterly withholding tax.

[grinin]

[ QUOTE ]
you are also supposed to be filing quarterly estimated tax payments rather than waiting until April 15

[/ QUOTE ]

[BottlesOf]

They work no differently than if you never cash out. You win money in the US at poker, you have a tax liability on those winnings, period.

[smb394]

[ QUOTE ]
[ QUOTE ]
you are also supposed to be filing quarterly estimated tax payments rather than waiting until April 15

[/ QUOTE ]

[/ QUOTE ]

Guess I didn't read your whole reply. We'll just say I added that for emphasis.

[augie00]

[ QUOTE ]
Have you ever recieved a W2G? I've been talking to my accountant and he said if you don't get any documentation from the sit not to worry.

I'm not giving advice!! Just curious.

[/ QUOTE ]

My parents' CPA said the same thing. Both of them (your accountant and my parents' CPA) are idiots.

[LIRob23]

[ISF]

I would imagine alot more people then are willing to admit it fall into this camp.

[KyleM]

Do all of your cashouts to neteller debit card and use cash all the time. And don't pay taxes. /images/graemlins/grin.gif

[pudley4]

[ QUOTE ]
Honestly, everyone on this site is way to gung ho about paying taxes. Everytime this question is asked you have 30 people screaming to pay your taxes. I say don't pay any taxes on your winnings unless poker is your only source of income. If you have a regular job and Uncle Sam is taking their cut from you already, keep this for yourself. All the government will do anyway is waste half your money building spaceships that break, fund a bunch of worthless "social" projects, or waste money trying to build a new stadium and get the olympics. If the money was actually used for things like Education, Healthcare, and securing our nation I wouldn't mind but this is not the case. So go out and spend some of your hard earned money that you grinded out on the felt. (It's good for the economy). Peace

[/ QUOTE ]

Retarded. Stop giving advice immediately.

Read this (http://forumserver.twoplustwo.com/favlinker.php?Cat=&Entry=118693&F_Board=inet&Threa d=2287155&partnumber=&postmarker=) and then decide if it's worth it to avoid paying a couple thousand a year in taxes.

[LuvDemNutz]

[ QUOTE ]


Retarded. Stop giving advice immediately.

Read this (http://forumserver.twoplustwo.com/favlinker.php?Cat=&Entry=118693&F_Board=inet&Threa d=2287155&partnumber=&postmarker=) and then decide if it's worth it to avoid paying a couple thousand a year in taxes.

[/ QUOTE ]

I am not giving advice one way or another.

But it is worth noting that in that thread OP's only source of income was poker, and he didn't file a return at all for several years.

[LIRob23]

[moondogg]

[ QUOTE ]
"Here are the sad but true answers to those questions..
Poker was my only income, and I have never filed a tax return on it. My current lifestyle is living in an apartment and driving a used car."

That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

Unfortunantely, the US government does not a damn about your opinion in the matter. You don't get out of taxes because you can come up with some BS rationalization.

[PokerBob]

[ QUOTE ]
"Here are the sad but true answers to those questions..
Poker was my only income, and I have never filed a tax return on it. My current lifestyle is living in an apartment and driving a used car."

That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

It's merely a gamble. The IRS will have no record of this money. But, if for some reason you ever get audited, something isn't gonna add up and then you're [censored]. If you make, let's say, 50K at your "real" job and make 2K from poker, then they likely would never notice even if you were audited. But at some point the money is impossible to hide. I make 50K/year, but have made another 20K from poker and you can bet your ass I'm paying my taxes.

[WhiteWolf]

I'm assuming you're asking about US taxes. My advice:

1) Don't rely on advice from internet discussion boards as your sole source of info. This applies to this post, but it especially applies to the posts that urge you to commit felony tax evasion.
2) Read this site (http://www.onlinepokerfaq.com/guide/us-taxes.html) to start educating yourself on US tax laws.
3) Run everything by a tax professional.

[MD2020]

[ QUOTE ]


That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

Al Capone had a real job as a seller of used furniture. I'm sure he paid taxes doing that.

So why should he pay taxes on a little bit of money he made on the side selling some booze?

[rbenuck4]

I am a student currently. I play poker semi professionaly and make around 50K for the year. I am currently in the process of closing on an apartment and I will have a morgage. However, my parents are partners in the deal and we are going (1/3, 1/3, 1/3) on the place. Do I need to file, and if so, how do I not deal with the whole winnings minus losses thing that will move me into a ridiculous tax bracket. Thanks in advance.

[LIRob23]

[LuvDemNutz]

[ QUOTE ]
[ QUOTE ]


That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

Al Capone had a real job as a seller of used furniture. I'm sure he paid taxes doing that.

So why should he pay taxes on a little bit of money he made on the side selling some booze?

[/ QUOTE ]

This is an asinine analogy.

[grinin]

[ QUOTE ]
Run everything by a tax professional

[/ QUOTE ]

Unfortunately, the average "professional" gives out advice like this:

[ QUOTE ]
if you don't get any documentation from the site not to worry.


[/ QUOTE ]

In these type of cases, you may be far better off getting advice from internet discussion boards.

[grinin]

[ QUOTE ]
I play poker semi professionaly and make around 50K for the year

[/ QUOTE ]

Nothing "semi" about this. You just need to file as a pro if you are making that kind of dough and you are not itemizing already.

[ActionBob]

[ QUOTE ]
Nothing "semi" about this. You just need to file as a pro if you are making that kind of dough and you are not itemizing already.

[/ QUOTE ]

I'm certainly not an accountant, but this is simply not true. The amount you may have made for the year really has nothing to do with whether you should file as a pro or not.

-ActionBob

[MicroBob]

I might be a total idiot but I fail to see how getting an apartment should effect your taxes.
You made $50k playing online poker.....so you owe taxes on that. Period.


Gamblers' Guide to Taxes by Walter Lewis is a decent read.
It doesn't specifically cover online-poker but it does help in general on things such as how to file as a 'recreational' gambler...how to file a 'schedule-C' as a pro, etc.

If you won $50k playing poker over the course of the year then just pay taxes on $50k.
Trying to make the various determinations on what you won or lost on each session can have you paying more in taxes then what you won in the first place.
If the numbers look like they add up and you are obviously making an effort to do the right thing then hopefully the IRS won't decide to send you away.


If I made less than $2k playing online-poker I probably wouldn't bother to pay taxes on it.
I certainly don't think there are many recreational B&M players who file taxes on their winnings if they haven't won a lot.

I did pay taxes on my small amount of winnings in 2003 but that was because I had every intention of trying to 'go pro' in 2004 and wanted to establish a history of being a winning gambler. So I decided to pay taxes on my recreational winnings in 2003 even though it wasn't much.


Obviously if you are winning more than $5k or $10k a year playing online and there is an obvious trail of electronic transactions from your neteller to your bank then you better be paying taxes on it.

[Chadt74]

I have to chip in here...

1 - I am a CPA and any CPA that tells you not to pay taxes on taxable income runs the risk of losing his/her license. I have heard of tax professionals telling car salesmen that they can deduct their haircuts as a business expense; ask enough people and at some point you will get the answer you want to hear. Most CPA/tax professionals will not tell you that hiding income from the IRS is the best way to go. Do your own research or ask friends for references and do not always go with the cheapest advice.

2 - making $50K does not mean you have to file as a professional gamblor. Think of the old lady who hits a $50K jackpot, she is not a pro, it is your intent that is the driving factor (as well as tax reasons).

3 - Not paying taxes is just unAmerican, you have the highest standard of living and you do not want to help support the country get the fu*k out and go to some other country who doesn't 'squander' your taxes.

4 - Taxing money once is only a personal thing. If you paid $3K to a carpenter to build you a wine rack guess what that is $3K of taxable income to the carpenter even though you paid taxes on it already; no different than playing poker, taxable to both.

5 - Not getting a W2G is the same as not getting a 1099 from someone, you still have the responsibility to pay taxes. It is your choice and there are over 100 countries in this world, if you do not like yours and their tax structure move.

[wulfheir]

Canadians don't pay taxes on prize money.

[moondogg]

[ QUOTE ]
Another thought ...

[/ QUOTE ]

I think I found your problem, it's that you're thinking.

Stop trying to be clever, you're not very good at it.

Follow the law or don't, but stop advising other people to commit felonies.

[moondogg]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]


That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

Al Capone had a real job as a seller of used furniture. I'm sure he paid taxes doing that.

So why should he pay taxes on a little bit of money he made on the side selling some booze?

[/ QUOTE ]

This is an asinine analogy.

[/ QUOTE ]

Asinine, like a fox!

[Nigel]

[ QUOTE ]

3 - Not paying taxes is just unAmerican, you have the highest standard of living and you do not want to help support the country get the fu*k out and go to some other country who doesn't 'squander' your taxes.

It is your choice and there are over 100 countries in this world, if you do not like yours and their tax structure move.

[/ QUOTE ]

1) It's not as easy as you make it out to be.

2) Suggesting our goverment does not squander our tax dollars and implying that only in america can you have a high standard of living is ridiculous.

3) Suggesting people that do not pay their taxes are "un-american" probably indicates you do not have a strong grasp on American history.

Nigel

[LIRob23]

[mdeck]

[ QUOTE ]
3) Suggesting people that do not pay their taxes are "un-american" probably indicates you do not have a strong grasp on American history.

[/ QUOTE ]

well played.

[moondogg]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Another thought ...

[/ QUOTE ]

I think I found your problem, it's that you're thinking.

Stop trying to be clever, you're not very good at it.

Follow the law or don't, but stop advising other people to commit felonies.

[/ QUOTE ]

"I do whatever I want, to whom I ever I want, at all times."

[/ QUOTE ]

Good for you. Just don't pretend that it's not a dumb [censored] idea.

[Chadt74]

Nigel I was not suggesting our government does or does not squander our tax dollars, simply that if you feel (as a previous poster indicated) your money is not well spent in America go somewhere else where you feel it is. Also America has one of the highest standards of living across all countries, I did not suggest that other countries do not have high standards of living, just that things like plumbing, safe drinking water, paved roads, electricity etc etc does not come cheap and if you want to have those things someone has to pay. Norway who has the current highest standard of living has up to a 55% tax rate on individuals and a 18% VAT tax on all good (at every stage in production) and most services.

If I interpret your last comment correctly you are referring to one (or all of three taxes), the Stamp act, Townshead act and tea tax? The stamp act and townshead acts were to provide money to support the colonies defense, hell the stamp act was already in place in England they were just enforcing it in the colonies. As for the tea act it actually lowered the price of tea. The issue was taxation without representation so unless someone feels poker players are not properly represented in our government (thus they do not pay taxes) they have nothing in common with early American patriots.

[grinin]

I didn't mean to imply that he was required by law to file as a pro because he made such and such amount. As you said, the amount you make has little to do with whether or not you should file as a pro. Just in his situation, it looks like it would probably be the best "legal" option, since he has no other deductions to itemize.

Of course, he could do like probably 75% of the guys that do pay their taxes on gambling income, and just pay on the net won amount, then claim ignorance if they call him on it. But for that kind of income I think it would be wise to try to dot the i's and cross the t's. Which means he really needs to get with a good CPA.

[Nigel]

[ QUOTE ]
Nigel I was not suggesting our government does or does not squander our tax dollars, simply that if you feel (as a previous poster indicated) your money is not well spent in America go somewhere else where you feel it is. Also America has one of the highest standards of living across all countries, I did not suggest that other countries do not have high standards of living, just that things like plumbing, safe drinking water, paved roads, electricity etc etc does not come cheap and if you want to have those things someone has to pay. Norway who has the current highest standard of living has up to a 55% tax rate on individuals and a 18% VAT tax on all good (at every stage in production) and most services.

If I interpret your last comment correctly you are referring to one (or all of three taxes), the Stamp act, Townshead act and tea tax? The stamp act and townshead acts were to provide money to support the colonies defense, hell the stamp act was already in place in England they were just enforcing it in the colonies. As for the tea act it actually lowered the price of tea. The issue was taxation without representation so unless someone feels poker players are not properly represented in our government (thus they do not pay taxes) they have nothing in common with early American patriots.

[/ QUOTE ]

Chad,

Moving to another country and establishing citizenship and renouncing your American citizenship is quite complicated and not as easy as just "going somewhere else".

I feel most of us are poorly represented by our government. It's not exclusive to poker players.

Nigel

[PuertoKid]

[ QUOTE ]

If you won $50k playing poker over the course of the year then just pay taxes on $50k.

Trying to make the various determinations on what you won or lost on each session can have you paying more in taxes then what you won in the first place.

If the numbers look like they add up and you are obviously making an effort to do the right thing then hopefully the IRS won't decide to send you away.


[/ QUOTE ]

This is very dangerous advice. MicroBob is suggesting that you follow a tax plan for you online winnings that are not in conformance with the law. MicroBob is correct that keeping track of all your sessions can have you paying more in taxes than you won, but it is, nevertheless, the law.

Of course, following MicroBob's advice is better than not declaring your winnings. If you don't declare at all, you may be guilty of tax evasion or some other crime.

[MD2020]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
[ QUOTE ]


That is the quote from the guy in the link you sent me to. As i stated in my rant, if poker is your only source of income then you should pay taxes on it. However, if you work and pay taxes every year from the money you earned at your "real" job I see no need to declare any income made from poker.

[/ QUOTE ]

Al Capone had a real job as a seller of used furniture. I'm sure he paid taxes doing that.

So why should he pay taxes on a little bit of money he made on the side selling some booze?

[/ QUOTE ]

This is an asinine analogy.

[/ QUOTE ]

Asinine, like a fox!

[/ QUOTE ]

Everybody should listen to moondogg. He's one guy who's on the trolley.