A Taxing Situation

[im51505]

I have a question about taxes and playing poker. I know there is a percentage of you that pay Uncle Sam $.03 if you find a dime on the street, but for the rest of you that play part-time, is not reporting your winnings illegal? Is there some sort of threshold(hours or $$ won) that must be crossed in order for reporting to become necessary? For those of you that do NOT pay taxes on your winnings, where do you keep the money? All in cash at home or do you put it in your bank account, or would this be problematic in the case of an audit?

I have been playing for a couple years now and don't really know the answers to these questions(of course, or I wouldn't be asking) and have found most of the advice to be relating to full-time players. I am also posting to the high/mid-limits, because you are the players that make enough for it to be an issue. If anyone has any information, it would be helpful, as I am wondering what is the best way to do this(read: keep as much money as possible and avoid any risks of tax penalties). I have a full-time job but have made over $30k/yr the past two years playing poker. Thanks in advance for the help.

[DannyP]

Simple answer to that one. If you want to be legal you declare the income and the expenses, no threshold time or $, pro or hobby. If you can sleep at night living with the thought of cheating the government the chances of being caught not declaring it are next to zero. Unless your making $10,000 transactions, or somebody doesnt like you and blows the whistle, you can do whatever you want with the money.

If you can make that kind of money part time, you must have a helluva full time job to not try going pro. If you do, then your chances of being caught go way up. If you disappear off the withholding lists, but they start seeing 1099s for interest, dividends, and brokerage reports, they will get very suspicious very fast.

[im51505]

Thanks for the reply. Yes, I can sleep at night without paying the damn government that I neither support nor believe in.

Yes, I have made that much in the past two years and I have thought about going pro, but it is nothing more than a passing thought. I don't think I could ever survive the lifestyle, currently I play less than 50 hours a month(I was playing 80hrs/month the past 2 years), and I don't think I could get away with that if I was a full timer. Plus, most importantly, I hardly think $30k/yr is anything to get too excited about(I make about 25% more post-tax at my real job), but it is GREAT as secondary income.

Am I looking to shoot an angle with the government? I guess so. For some people, it seems that breaking the tax code is like breaking a moral code. Ridiculous. But your advice is truly appreciated. Thanks again.

[34TheTruth34]

Yes, I can sleep at night without paying the damn government that I neither support nor believe in

Yes, taxes do suck. Maybe a country like Iraq has less taxes and a government that you could support and believe in. Have you thought about possibly moving there?

[astroglide]

let's not make this lame okay? /forums/images/icons/frown.gif

[Tyler Durden]

[34TheTruth34]

ok, thanks for sharing astroglide