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-   -   Tax Shelter??? (http://archives2.twoplustwo.com/showthread.php?t=407264)

krishanleong 12-29-2005 05:52 PM

Tax Shelter???
 
So I haven't heard anyone say anything about this yet. So I'm planning on reporting all the money I earned this year playing poker. Poker Money + rakeback + bonuses etc... I'm a good boy. But say for some reason I wanted to pay tax on 20K of my winnings next year instead of this year.

Can you say a certain amount of money you earn is still invested in your business (playing poker) and therefore not income? The idea is to deduct your working roll from the total amount you have earned for the year and then adding that amount to your tax liability the next year. It makes sense to me as business can't be forced to pay taxes on their inventory, just on the profits from items sold. So a poker player shouldn't have to pay taxes on his working bankroll. I haven't asked my CPA this yet but I certainly will. Thought it might be interesting to get the boards thoughts first.

If this works, I'll probably claim 1000 bets at my current limit as my working roll.

Krishan

krishanleong 12-29-2005 09:28 PM

Re: Tax Shelter???
 
bump... I shoulda posted this in HUSH. [img]/images/graemlins/smile.gif[/img]

Krishan

cardcounter0 12-29-2005 11:04 PM

Re: Tax Shelter???
 
Coca-Cola did the same thing. They didn't want to pay taxes on about 10 million dollars of their profit. So they just claimed they wanted to invest the 10 million into their business.

Short answer, no. Cash is not inventory.

climber 12-29-2005 11:53 PM

Re: Tax Shelter???
 
Dcfrthis has a theroy that it's working capital and so shouldn't be taxed...

I like the theory myself but unfortunately, as he pointed out, working capital is reported and taxed by law...

Ulysses 12-29-2005 11:56 PM

Re: Tax Shelter???
 
climber,

That sounds like a good followup to Dcifr's previous tax "advice" post, which should have been subtitled "how to maximize your chances of getting audited by the IRS."

Rockatansky 12-30-2005 12:13 AM

Re: Tax Shelter???
 
Here's an idea that's just crazy enough it might work: put it into an IRA and save instead of trying to cheat on your taxes.

zokbarjazz 12-30-2005 12:26 AM

Re: Tax Shelter???
 
*I am not an accountant*

Krishan,

Income that is "constructively received" during the taxable year must be reported in that year. Constructive receipt means income which you have an unrestricted right to receive. Any money you have as your bankroll (whether in neteller, a checking account, or on a poker site) has been constructively received, and therefore must be reported in the current taxable year.

Diablo said it's a good way to trigger an audit, but it's actually tax evasion and is illegal.

krishanleong 12-30-2005 12:31 PM

Re: Tax Shelter???
 
[ QUOTE ]
Here's an idea that's just crazy enough it might work: put it into an IRA and save instead of trying to cheat on your taxes.

[/ QUOTE ]

Hey [censored]. I'm coming to these boards with ideas to get feedback. I'm not going to cheat on my taxes.

Krishan

krishanleong 12-30-2005 12:31 PM

Re: Tax Shelter???
 
Thanks,

Krishan

Rockatansky 12-30-2005 02:34 PM

Re: Tax Shelter???
 
[ QUOTE ]
[ QUOTE ]
Here's an idea that's just crazy enough it might work: put it into an IRA and save instead of trying to cheat on your taxes.

[/ QUOTE ]

Hey [censored]. I'm coming to these boards with ideas to get feedback. I'm not going to cheat on my taxes.

Krishan

[/ QUOTE ]

I probably shouldn't have singled you out. It's just that every few days, someone posts something on these boards about their amazing new theory why they don't have to pay taxes on their poker income, or some crazy tax shelter they've thought up. The simple fact is, in the US, poker income is taxable.


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