[okayplayer]

Well, there are alot of replies here, most seem to be correct, but I will throw in my 2 cents, as I did a bunch of research into this before I turned Pro.

You do have to pay taxes on all your winnings, not just withdrawals. If you won it and it is earned, and they don't care if you withdraw.

You are supposed to keep a detailed log of your wins/losses. I track each nights performance with a Excel spreadsheet (if you are interested in this template, PM me and I can send it to you) and I also use PT. But, I think if you don't have these records, I would suggest adding up the total in your acct(s) and subtracting all your deposits and withdrawals, this should give you your wins. This will really fck you up if you aren't filing as a Pro, but I assume you are.

If you file as a Pro, you can claim your Net winnings, and deduct any expenses (travel, computer expenses, rent - the % of it that you use for office space, etc...). You do get stuck paying the extra 7.5% (actually I think it ends up being around 6.8% or so) for Medicare/SS (Self Employment tax), which your employer typically pays. I am not really sure how the difference works out to be if you didn't file pro vs if you did for the Medicare/SS (SE tax). But, I do know that if you don't file pro, you have to add up each winning session and deduct losses. A session would be looked at as each time you sat down at a table (and subsequently left). This is fairly easy to do using PT, but imagine how much your net wins would be - I calc'ed it once earlier this year.

Oh, and the burden of proof is never on the IRS, it's always on you.

PS - If you expect to make any sizable income from self-employment (ala Poker), the IRS expects you to make estmiated quarterly payments.