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#1
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Re: pokertracker and taxes
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I have yet to hear of someone getting in trouble for not filing as a professional and not reporting session by session. I just report net income as other income and leave it at that. I cannot imagine jsomeone getting in trouble for doing it this way, especially when all your transfer recoreds reflect the amount of income you made. [/ QUOTE ] This is a serious mistake. Being A CDN who knows US tax law very well you pay a higher tax rate on other income( commonly known on the form as unearned income) than you do if declaring as a main source of income. I do believe Billy Baxterbattled the IRs on this and won about 15 years ago. |
#2
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Re: pokertracker and taxes
The Baxter case is a bad example to try to prove your point. Baxter's case was related to the treatment of his income pre-1981. The tax rate in his situation would have been 70% for unearned income and 50% for earned income. He was obviously willing to fight for the 20% difference in income tax rates. Baxter wanted to file as a professional.
In 1981, the US had a major tax code revision which removed the difference in income tax rates for earned and unearned income. As a result of this change, the income tax rate is exactly the same for these types of income. If you include SE tax as a part of the consideration, the earned income could be considered to have a higher tax rate now. I would give you that the increase in deductions available to a professional might make the tax rate lower on the earned income. |
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