Nice win, now I have tax questions
 

Sorry if this is redundant for folks. I scored a nice $$ ( low 4 figures) win by finishing 4th in a PP Multi last night. Now I have the usual tax questions.

I will report the income, but I need to know:

1) Does Party report this win, or are just cash outs from the account reported? IOW, if I leave the dough at Party, is it not reported to the IRS unless I report it?

2) How do I document other gambling losses ( I play live sometimes too). Do I ask for a receipt when I buy in at the table? That sounds goofy.

All help appreciated.

I'm going to post in the psychology section about this tourney...on the subject of relishing your good fortune to offset the misery of bad runs.

Re: Nice win, now I have tax questions
 

Does Party report this win, or are just cash outs from the account reported?

Party is not in the US, thus it reports nothing to the IRS

How do I document other gambling losses

Keep a diary of all of your sessions.

Re: Nice win, now I have tax questions
 

that's too small a figure to bother thinking about reporting.

Re: Nice win, now I have tax questions
 

Technically, it isn't income until you start pulling money out of your poker account and spending it. Am I right? Even then, computer, internet service, and a portion of your electric bill is all tax deductible.

Re: Nice win, now I have tax questions
 

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Technically, it isn't income until you start pulling money out of your poker account and spending it. Am I right? Even then, computer, internet service, and a portion of your electric bill is all tax deductible.

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Legally, no you are not right. According to the IRS, when you ended the session (i.e. left the table), it was gross income. People have tried to rationalize that "it's all one big session", or "my session doesn't end until I withdraw" or and number of other ideas. I want to see someone actually tell an IRS agent this, and I want to know the over/under on how long he laughs his ass off at it.

If you leave money in a savings account, or a mutual fund, or pretty much anything which is not specifically tax-exempt or tax-deferred and generates profit, it is considered income and have to pay taxes on it, regardless of whether you withdraw.

Re: Nice win, now I have tax questions
 

[ QUOTE ]


2) How do I document other gambling losses ( I play live sometimes too). Do I ask for a receipt when I buy in at the table? That sounds goofy.

All help appreciated.


[/ QUOTE ]

Take a small portion of your winnings and invest in a good CPA.

Re: Nice win, now I have tax questions
 

No, that is incorrect. You do not have income until you actually get income. If I give you an I.O.U. that says I will pay you $20, you do not have $20 of income until you actually collect the $20.

Many professionals wait and bill their last month of the year's work until the very last day. They did the work, they sent the bill, but if they don't get paid until January, it is next year's income.

If you have a stock that goes up 1000% in value, you do not have income until you sell the stock.

If you have a winning million-dollar lottery ticket, you do not have income until you cash the ticket in with the lottery commission.

If you have winnings sitting in an online poker site, you do not have income until the funds are transfered into an account under your control.

Re: Nice win, now I have tax questions
 

I'm sure this is real shady but I'll ask anyway:

If I have a neteller account with a neteller ATM card, and withdraw funds that way... is there anyway that can be linked to me as income by the IRS or Revenue Canada (depending on which country I live in)?

Or is this an under-the-table way of dodging tax?

Re: Nice win, now I have tax questions
 

You don't think anybody is watching that cash flow over the electronic network to those ATM machines do you? Think the Federal Reserve and Banking System might do a little reporting to the IRS?
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Re: Nice win, now I have tax questions
 

It is probably not going to be found(Neteller ATM card), but it is income, I have heard conflicting things here about taxes, the main thing, get a CPA or someone who knows what is correct(spend a little, I believe they are tax deductable) keep records if you are going to report(you should) write off everything you can(the IRS lets you have those discounts, take them!)