Internet poker and taxes and moving abroad.

[Self Made]

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Who was this? Is this an actual case that is a matter of public record, or just what you've heard?

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It was reported in the media. Probably a few years ago. I can't cite a source. I think the guy was in Idaho, probably online casino gambling, but that's all I can remember.

Have you heard of someone being prosecuted for sportsbetting online, or are you just referring to people operating online sportsbooks, like Cohen?

[Rudbaeck]

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What's the benefit of being an American citizen? It was a great nation to be a citizen of in 1904. 100 years later I don't see any advantage.

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I honestly don't want to sound rude, but this is again an example of knowing very little about the world you live in. You don't see any advantage?? Of course, from a Swedish point of view, there's probably not much of an advantage. But the situation in Sweden (as in other countries in Scandinavia, Europe and a very few other places), is _not_ the standard. I'm actually quite amazed I have to say this.

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I understand perfectly well why someone would prefer to live in the US over living in Ethiopia. But I don't understand why someone who is willing to move anywhere would prefer the US over any other western democracy in general and the well run western tax havens in particular.

Though I agree, there is little reason for the OP to give up his american citizenship. Well, unless he is so far above $75,000 a year that it would significantly help him. If you give up your american citizenship it's better if it's because you've fallen in love with your new residence than for crass tax reasons.

Making $75,000 tax free per year should be enough.

[moondogg]

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Who was this? Is this an actual case that is a matter of public record, or just what you've heard?

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It was reported in the media. Probably a few years ago. I can't cite a source. I think the guy was in Idaho, probably online casino gambling, but that's all I can remember.

Have you heard of someone being prosecuted for sportsbetting online, or are you just referring to people operating online sportsbooks, like Cohen?

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Cohen definitely. I also though I had heard of a sports bettor getting nailed, in some ass-backwards left coast state like Idaho or Washington (we're probably thinking of the same case). However, I haven't been able to find a copy of the case in news archives, so it may have been my imagination.

Regardless, I'm pretty sure that illegal gambling charges (or pretty much anything else) can't be brought on the basis of tax returns.

Disclaimer: I ain't no damn lawyerin' type, and proud of it.

[feelixthegreek]

Of all the posts about paying taxes on gambling income, your point about Schedule C's is the one that makes the most instinctive sense to me--i.e. net winnings minus expenses. Of course, just because it makes the most sense doesn't mean that it's the legal thing to do. Anyone else see this as a viable, realistic, and legal way of calculating earnings? Where is the flaw?

[Panace50]

it is the legal thing to do if you are making a living playing poker. The offsetting factor is the 15% social security payment (they say it isn't a tax, cause you are paying your own retirement fund)There are more questions possible if you file a schedule c if you have w-2 income as well, but i did file the last year i worked other than poker, and was not audited or hassled. Maybe i just got lucky, but it seems to be that while they have the right to hassle you, the reality is that if you file anything that is reasonable, the statute of limitations is about 3 years from filing. if you do not file, there is no statute of limitations and they can ask for the money anytime in the rest of your life.

[feelixthegreek]

Exactly what I figured, but how liberal do you get with deductions-- home office, travel-- in order to bring down the taxable income?

[Panace50]

the key is always to do taxes two ways. First do taxes the way you think IRS agenst would do them. Then be as aggressive as you can without being fraudulent. When in doubt, deduct it!

Then put the difference in savings and wait three years. After the three years, you can count the money as yours, since the statute of limitations has expired for IRS to question your figures. Unless they think you were fraudulent, you are safe. This is important, since ours is a voluntary tax program. If IRS had to go out and figure taxes for every tax payer, the cost would be overwhelming, so they just rely on the fear factor and the good character of the american people to collect taxes?

[Blarg]

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How do you find out what in what countries poker is not taxed ? From what I gather here,

NZ,
Australia,
UK,
Canada (if recreational)

are tax free for poker.

Any others to add to the list ?

How about,
Italy ?
Switzerland ?
Japan ?
Spain ?
Germany ?


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I've just scanned the forums and seen the topic come up once in a while. A search of Matt Hilger's site should yield a couple of the good threads I found there on it, where there's occasionally a somewhat extensive discussion about it.

[Danielih]

You can only get out of paying US taxes if you are no longer a U.S. Citizen. If you forfeit your U.S. citizenship for tax purposes you can never enter the US again and never regain your citizenship.

[Lori]

but i did file the last year i worked other than poker,

Does this mean stealing, lying and generally ripping people off doesn't pay as well as I thought?

Lori