Tax Questions and a Survey.

[buffett]

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but if I were so lazy as to win under $1000 in a year, I would pay taxes on that, too.

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Me, too. I think this should have been an option.
I am not a CPA, but my personal rule is to declare my "realized" winnings, which I define as "I have moved the cash out of my Neteller account."
My buddy (also not a CPA, but whose opinion on any topic is highly valued by me) vehemently disagrees with my theory and says that, each December 31, I should look at how much I'm up at that time and declare that.
-web

[Chap_Stick]

Before this year I haven't made money to actually worry about taxes. This year I'll actually file.

[MisterKing]

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I just filled out my tax return and declared my winnings. The feds only took about 15% of my winnings. Well worth not worrying about getting audited.

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Did you have other reportable income, or were the poker winnings your only "income." Also, did you use Schedule A for deducting your losses?

While I'm still piecing information together on this, my current understanding is that you:
1.) Total up your winnings for 2004, by SESSION (not by hand, day, week, month), and report them as "other income" on your 1040. This will make your Adjusted Gross Income (which determines which tax bracket you end up in) rise.
2.) Total up all of you losing sessions, and report them on a consolidated basis (e.g. a total figure) on Schedule A (don't know WHERE on Schedule A). Reporting in this fashion should help knock down the total tax amount you owe for 2004, but certainly not by the $$ amount of your losses. E.g. if you had "winnings" of 5K and "losses" of 3K for a net +$2K year, your taxes would never be reduced by 3K just because you reported that on Schedule A.
3.) Go through the rest and just pay whatever you owe, or take whatever refund you're owed.

ALSO: Do I need to file a W-2G for poker winnings???

[LinusKS]

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...I've been thinking a lot about this too, and to be honest, with poker's enormous popularity right now, I bet eventually the IRS will find a way to crack into the books of all the offshore casinos and find out who's made money and not paid their taxes. The IRS is probably becoming more aware of how much revenue they can collect from people, not only because poker is so popular, but because they now realize that MANY people are capable of making a living at this...

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I'm not so sure about that.

The only reason so many people make money at poker is that so many other people lose money.

To be fair - and yes, I realize the tax system isn't fair - doesn't it seem like the losers ought to be able to deduct the same amount the winners are supposed to declare?

If they did, the net result would be zero (or less than zero, considering the rake).

They'd never allow that, of course. (Politicians wouldn't want to be seen giving a "break" to gamblers.)

But if they were sensible, they'd do like they do in other countries (as our Canadian and English friends never tire of reminding us) and leave gambling out of the equation altogether.

[droolie]

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I just filled out my tax return and declared my winnings. The feds only took about 15% of my winnings. Well worth not worrying about getting audited.

[/ QUOTE ]

Did you have other reportable income, or were the poker winnings your only "income." Also, did you use Schedule A for deducting your losses?

While I'm still piecing information together on this, my current understanding is that you:
1.) Total up your winnings for 2004, by SESSION (not by hand, day, week, month), and report them as "other income" on your 1040. This will make your Adjusted Gross Income (which determines which tax bracket you end up in) rise.
2.) Total up all of you losing sessions, and report them on a consolidated basis (e.g. a total figure) on Schedule A (don't know WHERE on Schedule A). Reporting in this fashion should help knock down the total tax amount you owe for 2004, but certainly not by the $$ amount of your losses. E.g. if you had "winnings" of 5K and "losses" of 3K for a net +$2K year, your taxes would never be reduced by 3K just because you reported that on Schedule A.
3.) Go through the rest and just pay whatever you owe, or take whatever refund you're owed.

ALSO: Do I need to file a W-2G for poker winnings???

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I didn't do it that way. I just took my net consolidated annual winnings and listed them on line 21 as gambling winnings. I took screenshots of my poker account histories and pokertracker in case I'm audited. I have another job that is my primary income source. I left some money on the table by not report gambling losses on Schedule A for the $$ I spent on books, pokertracker, PC upgrades etc but felt it was easier and cleaner doing it this way.

[MisterKing]

thanks man.