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#1
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Re: Who Reports Their Winnings As Income?
I played HE with a guy a casino one time who asked a lawyer about reducing the amount of taxes he had to pay on his winnings. The lawyer told him to withdraw a bunch of money from an ATM every time he went to the casino and keep a receipt for it. With cash payouts, there is no way the IRS could prove that you DIDN'T lose the money gambling.
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#2
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Re: Who Reports Their Winnings As Income?
[ QUOTE ]
I played HE with a guy a casino one time who asked a lawyer about reducing the amount of taxes he had to pay on his winnings. The lawyer told him to withdraw a bunch of money from an ATM every time he went to the casino and keep a receipt for it. With cash payouts, there is no way the IRS could prove that you DIDN'T lose the money gambling. [/ QUOTE ] That seems a bit sketchy/urban legendish. Lawyers get disbarred for recommeding illegal actions to thier clients. Not to mention in tax court, the burden of proof for a lot things are with the taxpayer not the irs. |
#3
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Re: Who Reports Their Winnings As Income?
[ QUOTE ]
[ QUOTE ] I played HE with a guy a casino one time who asked a lawyer about reducing the amount of taxes he had to pay on his winnings. The lawyer told him to withdraw a bunch of money from an ATM every time he went to the casino and keep a receipt for it. With cash payouts, there is no way the IRS could prove that you DIDN'T lose the money gambling. [/ QUOTE ] That seems a bit sketchy/urban legendish. Lawyers get disbarred for recommeding illegal actions to thier clients. Not to mention in tax court, the burden of proof for a lot things are with the taxpayer not the irs. [/ QUOTE ] Nothing illegal here. The lawyer merely stated that the client should take out a large amount of money and keep a receipt. What the client does from there is left to the imagination. |
#4
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Re: Who Reports Their Winnings As Income?
[ QUOTE ]
I played HE with a guy a casino one time who asked a lawyer about reducing the amount of taxes he had to pay on his winnings. The lawyer told him to withdraw a bunch of money from an ATM every time he went to the casino and keep a receipt for it. With cash payouts, there is no way the IRS could prove that you DIDN'T lose the money gambling. [/ QUOTE ] This is by far the best option in terms of risk/reward ratio. Don't dodge the taxman unless you want to live your whole life that way. If the interest catches up to you in 5 years like it did to my uncle, you can owe nearly double what you tried to avoid. Not to mention long term concerns such as retirement and insurance, which will be accounted for by your income. |
#5
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Re: Who Reports Their Winnings As Income?
Actually, they don't have to prove you lost the money gambling.
First they may wonder why you kept gamlbing if you always lost (assuming you don't report a reasonable win rate). Then they would perform a net worth and income analysis to see how you could afford your lifestyle given substantial, recurring loses. A good investigator uncovers this scheme about 70-80% of the time in my experience. |
#6
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Re: Who Reports Their Winnings As Income?
Just a comment to the Mouse about two guys who told me that the IRS nabbed them real good.
About 8 or 9 years ago, a very visible Lobal tournament & ring game (B&M) poker player told me about his bad experience with the IRS. He won about 100 K over about a two year span at the Bicycle Casino in Los Angeles County, CA; and stashed his cash at the player’s bank at this casino. Somehow somebody else was aware of his keeping his bankroll in the player’s bank and reported same to the IRS (at this time there was a ten-percent reward for helping to nab people who didn’t report all of their income). He told me that he was now obligated to pay the IRS about $500 per month for years – this guy was very bitter. He suspected that the IRS informant worked in the cage at the Bicycle Casino. I also met another guy “B&M poker player who had a similar experience, and had to make monthly payments to the IRS for an extended period of time. He said, “This was a very bad experience for me.” The moral of this is: “Some people get caught.” |
#7
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Re: Who Reports Their Winnings As Income?
Carl,
Thanks for the story. If I start making 100K, I would report most of it for sure. For the amount I make now, it doesn't make sense to (I don't think), as there is little risk of getting caught. Anyway, I'd still like to learn more facts about how it works, and what methods the IRS uses. From the responses here, it seems like they have everyone scared into submission, and nobody really knows what methods they have access to, but just assumes that they are omnisicient and all-powerful. My point is just that there are also some people who don't get caught, and I don't think it's just a matter of luck. gm |
#8
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Re: Who Reports Their Winnings As Income?
[ QUOTE ]
Carl, Thanks for the story. If I start making 100K, I would report most of it for sure. For the amount I make now, it doesn't make sense to (I don't think), as there is little risk of getting caught. gm [/ QUOTE ] Now this is poor thinking, the penalty for getting caught is the same whether it is for $1000 or $100K. You should be thinking the opposite of what you are. See Title 18 USC § 371 for the penalty for conspiracy to commit tax fraud. |
#9
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Re: Who Reports Their Winnings As Income?
[ QUOTE ]
He told me that he was now obligated to pay the IRS about $500 per month for years – this guy was very bitter. [/ QUOTE ] It never ceases to amaze me how people who break the law and get caught are bitter. |
#10
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Re: Who Reports Their Winnings As Income?
Hey GM,
2. Cashout using NETELLER, and then withdraw the money using a Neteller ATM card. This is easy and convenient, but probably not too safe. That is, I have no idea if the IRS could get access to your Neteller records or not. Anyone know? Although Neteller isn't a US operation, I'm almost positive their ATM cards issued here in the US are routed through a US bank. You can check. The "safest" way is to get mailed a check and cash it through a check cashing place and pay the percentage fee. I've never used one, but I would imagine if your check is over a certain dollar amount there would be extra paperwork involved, so you'd want to keep the checks on the light side. The real "safest" way is to claim your winnings as income, like you're legally obligated to do. If you want tax reform, start voting like it. GoT |
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