#21
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Re: When are internet poker earnings taxable income?
While that is a very interesting theory (and I can see some logic behind it), do you honestly think that the IRS is going agree with you?
The real problem with all of this is that we basically just have to do whatever the IRS says - regardless of how stupid it is or how much something else makes more sense. |
#22
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Re: When are internet poker earnings taxable income?
That's a really good point you bring up. I can totally see the IRS saying something dumb such as "You earned the money when you stopped playing for the day. It doesn't matter that it was then stolen from you." Of course they probably would never even find out about the situation so it's not something to worry about. [img]/images/graemlins/smile.gif[/img]
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#23
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Re: When are internet poker earnings taxable income?
I believe the latter is correct. It would be impossible to record a hand-by-hand session.
Cash in, cash out covers the range of a reportable session at the tables so I assume it is the same for online. |
#24
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Re: When are internet poker earnings taxable income?
Cash in - cash out is NOT how you report winnings from a B&M casino. It is done on a session basis.
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#25
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Re: When are internet poker earnings taxable income?
[ QUOTE ]
Cash in - cash out is NOT how you report winnings from a B&M casino. It is done on a session basis. [/ QUOTE ] What are you calling a session and does it differ from what I said already? "Cash in, cash out covers the range of a reportable session at the tables" Sorry, did you read this as cashing out from the casino? I meant from each table as you play. |
#26
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Re: When are internet poker earnings taxable income?
I have a friend who wins entries into big tourneys. This would also include winning step tourneys on Party and then losing in step 5.
How are these treated at tax time? If you play a step 2 ($55 expense) and win entry into step 3 ($215 I think), and then lose, what is your liability? It would seem to me that you must report winnings of $160, and then losses of $215, (or total loss of $160 to match winnings) This results in a net tax liability. Comments appreciated. I will cross post this. |
#27
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Re: When are internet poker earnings taxable income?
"If you play a step 2 ($55 expense) and win entry into step 3 ($215 I think), and then lose, what is your liability? It would seem to me that you must report winnings of $160, and then losses of $215, (or total loss of $160 to match winnings) This results in a net tax liability. "
If you would have ONLY these two gambling records for the entire year, I think this is: Step Two- Win $215, cost $55 goes in gambling losses Step Three- Win $0, cost $215 in gambling losses If this is all you gambled for the year, you'd have to change the total deduction because your $160 "profit" from the Step 2 limits the deduction for the $215 cost for the Step 3. You can't end up with the initial $55 being a "loss" unless you have other gambling wins to offset it and bring your loss to $0. |
#28
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Re: When are internet poker earnings taxable income?
I think the IRS will buy it because it will match up with my electronic fund transfers. If they are knowledgable about poker they may suspect some "fudging", but as long as the numbers match, I don't think it will be a problem.
I'm not saying this is bullet proof, but in my opinion, it should survive an audit. And if my reported earnings are there and match there records of my earnings, I should be able to avoid penalties and fines. |
#29
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Re: When are internet poker earnings taxable income?
You do not have to report any income if the only prize you received in a tournament was entry into another tournament. But of course if you cash in the 2nd tournament you have to report that amount of money as income.
In addition, you almost have to report income for prizes won besides the entery fee. For example, lets say you won an online satilite for the main event of the WSOP. You do not have to pay taxes on the 10k entry fee, however, you would have to pay taxes on airline tickets, hotel, food, etc that may have gone along with the prize |
#30
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Re: When are internet poker earnings taxable income?
I think the point that you may be missing is that filling by a session by session basis will greatly increase your Gross Adjusted Income. For most people this will increase their tax liability. The IRS knows this and will want their 'fair' share of your money. I don't think the IRS would truely care if you were paying the correct amount no matter how you calculated it but that probably isn't the case here....
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