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#1
04-10-2005, 05:38 PM
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Another Stupid Tax Question
This has probably been asked before, but I suck at using the search here so:
I'm trying to plan ahead for taxes for next year, and was hoping to get some advice from people who have already done there taxes for this year, and know a little more about this all than I do. What % of earnings should I expect to have to give back to the govt. next year, if I earn about $10k from poker this year? Anyone have any links to how this % changes as the level goes up? Do I have to differentiate poker earnings from my regular earnings on my tax forms? If so, are poker earnings taxed at a higher rate than regular earnings? Also, you provide a W-2 as proof of your earnings at a regular job, what is the "W-2" for poker winnings? Finally, is there any trouble that could be caused by the fact that I'm filing winnings from poker when I'm under 21? Thanks for your help, and sorry that these questions have probably all been asked already. 
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#2
04-10-2005, 08:07 PM
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Re: Another Stupid Tax Question
[ QUOTE ]
What % of earnings should I expect to have to give back to the govt. next year, if I earn about $10k from poker this year? Anyone have any links to how this % changes as the level goes up? [/ QUOTE ] About 15%, probably less. Just go to irs.gov and look at the 1040 forms to find out exactly. [ QUOTE ] Do I have to differentiate poker earnings from my regular earnings on my tax forms? [/ QUOTE ] Yes. Your winnings are counted as "other income" and your losses are an itemized deduction. The standard deduction is $4850, so if your losses are less than that, you don't need to worry about it, just take the standard deduction of $4850. It's the same rate as your regular income. Unless you're a dependent, in which case I don't know if it changes. [ QUOTE ] inally, is there any trouble that could be caused by the fact that I'm filing winnings from poker when I'm under 21? [/ QUOTE ] No, but you could possibly get in lots of trouble if you don't file taxes.
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#3
04-10-2005, 08:14 PM
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Re: Another Stupid Tax Question
[ QUOTE ]
Yes. Your winnings are counted as "other income" and your losses are an itemized deduction. The standard deduction is $4850, so if your losses are less than that, you don't need to worry about it, just take the standard deduction of $4850. [/ QUOTE ] So if I'm reading this correctly you have to file gross winnings not net? And then you deduct $4850 from this?
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#4
04-10-2005, 08:37 PM
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Re: Another Stupid Tax Question
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#6
04-10-2005, 09:24 PM
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Re: Another Stupid Tax Question
[ QUOTE ]
So if I'm reading this correctly you have to file gross winnings not net? And then you deduct $4850 from this? [/ QUOTE ] Yes, you need to keep records of what you won and lost each session. If your total losses were less than $4850, you take the standard deduction of $4850. If losses were more than $4850, you itemize your deductions and deduct whatever you lost. The Gambler's Guide to Taxes is an excellent book, and you sound like you need it.
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#7
04-10-2005, 09:30 PM
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Re: Another Stupid Tax Question
[ QUOTE ]
[ QUOTE ] So if I'm reading this correctly you have to file gross winnings not net? And then you deduct $4850 from this? [/ QUOTE ] Yes, you need to keep records of what you won and lost each session. If your total losses were less than $4850, you take the standard deduction of $4850. If losses were more than $4850, you itemize your deductions and deduct whatever you lost. [/ QUOTE ] Not exactly. If all your itemizable deductions are less than $4850 take the standard deduction. To max your deductions (first thing is to get a CPA, let him deal with the details) declare as a pro. That gets things like 'net access, monitors, PC's, PT, books, etc deductable. For all non 1040-EZ filers GET A TAX PRO - not H&R Block, a real pro.
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#8
04-10-2005, 09:48 PM
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Re: Another Stupid Tax Question
[ QUOTE ]
Not exactly. If all your itemizable deductions are less than $4850 take the standard deduction. [/ QUOTE ] That's exactly what I told the OP to do. [img]/images/graemlins/confused.gif[/img] [ QUOTE ] To max your deductions (first thing is to get a CPA, let him deal with the details) declare as a pro. That gets things like 'net access, monitors, PC's, PT, books, etc deductable. [/ QUOTE ] He made about $10k. How is the IRS going to believe that he's a pro? Plus, you need to pay social security taxes if you're a pro.
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