Re: Poker Tax Question
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I have heard that you file as a small business and pay roughly 30%.
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the actual rate that you pay is determined by your TAXABLE INCOME for the calendar year (Jan 1 - Dec 31). The amount you pay during the year is an estimate of what you think you will make (do a projection and determine your taxable rate and therefore level of tax and tax owed). If you are under $15,000 or so, the rate is around 10%. If you are at $100,000, you go to 34% or so.
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If I do this, but claim say, 75% of my income, or 50%, what risk, and penalties are there for doing such?
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Again, this largely depends on how much income you are projecting and what you filed in the prior year - as those are the two main benchmarks for determining penalties and what levels to maintain. They aren't that harsh unless you show fraud/mal intent or something like that.
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