Who Pays Taxes on Poker Earnings? (POLL)

[AL5AcE]

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lol I can see the situation now. The gov't will see that I filed taxes this year and see some huge AGI that never existed before and notice that I don't have a job and am 19 years old. They will then see this huge amount for a deduction and audit my ass so quick I won't even have time to load up pokertracker. But anyway... that chart someone linked me to about being able to deduct state expenses or whatever... even if you are making 90k AGI for the year the deduction for my state was only around 656... unless i'm supposed to haev a different # of exemptions than 1.. i don't even know what exemptions are.

This seems like such a big headache... i feel as though if i start reporting now my % chance to get audited goes up, and if that were to happen at this point i've got money that I havent been keeping records for... wtf do i do about that? Just start filing and get audited? Alot of the money I made when just starting out in poker a long time ago was from a few nice finishes in step 5 mini steps.. a win on an MTT.. and a buncha SNGs... and poker tracker does'nt even track this accurately unless you're importing the tournament HHs which I wasn't doing at the time.

If i were to just report my profits up to this point and then start keeping records from here on out I wonder if that would be fine...

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Yea, I have the same questions as Python49.

[theblitz]

Me too.
I haven't made enough to have to pay yet.

When I do - then I will probably pay since tax on gambling is only 25% in Israel.
Not worth avoiding it for 25%

[jetsg4]

acquire a business license, and report income quarterly... or keep your money in cash and a part time job so you have reported income and taxes paid

[jrz1972]

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also doesnt filing taxes on gambling just draw a red flag in their system anyway and give them more of a reason to audit you?

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1. Probably not. People who report gambling winnings are demonstrating honesty by reporting them in the first place.


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I presume that you still believe in santa claus.

I can picture an IRS agent going through a persons file and deciding that since this person is reporting his illegal poker earnings that he must be an honest guy.

I think everyone should pay their taxes, i certainly pay my fair share. But don't be ignorant and think that there arent inherent risks when you report gambling winnings.

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First of all, you don't know any more about the IRS rules that trigger audits than I do, so drop the tone.

Second, what "risks" are you talking about? Let's say, hypothetically, that I did in fact get audited. Can you explain why I should care? I mentioned before that I am not a deadbeat. I follow the letter of the tax code (or, more accurately, the CPA who does my taxes follows the letter of the tax code). If the IRS audited me for some weird reason, I would have absolutely nothing to worry about.

You're basically arguing that if you follow the law you increase the chances of being punished somehow, which obviously makes no sense.

[jrz1972]

I should add here that I take all of this kind of personally. I enjoy playing poker, and I vote Libertarian, so I am no great friend of our tax code. But when poker players deliberately commit tax evasion and resort to sophomoric quasi-libertarian arguments to support their position, they make the rest of us look like deadbeats and degenerates. I don't appreciate that at all, and it certainly doesn't help the image of our game.

[Mempho]

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lol I can see the situation now. The gov't will see that I filed taxes this year and see some huge AGI that never existed before and notice that I don't have a job and am 19 years old. They will then see this huge amount for a deduction and audit my ass so quick I won't even have time to load up pokertracker. But anyway... that chart someone linked me to about being able to deduct state expenses or whatever... even if you are making 90k AGI for the year the deduction for my state was only around 656... unless i'm supposed to haev a different # of exemptions than 1.. i don't even know what exemptions are.

This seems like such a big headache... i feel as though if i start reporting now my % chance to get audited goes up, and if that were to happen at this point i've got money that I havent been keeping records for... wtf do i do about that? Just start filing and get audited? Alot of the money I made when just starting out in poker a long time ago was from a few nice finishes in step 5 mini steps.. a win on an MTT.. and a buncha SNGs... and poker tracker does'nt even track this accurately unless you're importing the tournament HHs which I wasn't doing at the time.

If i were to just report my profits up to this point and then start keeping records from here on out I wonder if that would be fine...

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Yea, I have the same questions as Python49.

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Yes, your chance of being audited will probably go up. Your chance of owing substantial interest and penalties or going to prison as a tax evader [img]/images/graemlins/blush.gif[/img] will go down (because you will be telling the truth). There is no way around that. It should come as no surprise that those who are more sucessful in society are more likely to get audited. Do you think they're likely to audit a $6 food service worker? I think they'll pass.

As for records, your record keeping may be easier than you thought if you played online at party or an affiliate. Try logging into "My Account" and going into "View your activity" under the "Other Options" section. You can change the date ranges on the bottom and go back for several months.

[Python49]

Aside from my other questions i asked in my last post... im curious to know the outcome of said scenario:

20 year old gets into poker online after seeing commercial on tv (said commercial says "Not a gambling site)

Throughout college he makes over 100k on party poker and just ignorantly cashes it out little by little over the course of his poker playing career... nothing over 10k.

He does not change his lifestyle in anyway such as buying fancy cars or living in a nicer place, but just keeps the money in his bank account.

Does this amount of money increase chance of being reported to IRS and being audited?

Ok, let's say he does indeed get audited and says to the IRS "Taxes? I played recreationally and just happened to win... didn't know anything about taxes"

How much is he probably going to be paying of that 100k and what are the chances that he'd even get hassled by the IRS to begin with.

If he WERE to report his taxes legitimately how much of that 100k is he probably losing to taxes.

[Python49]

I don't think they have that account summary at eurobet, if so... it hasnt been working for me and I can try again. This still would not give me accurate records for money I made at party poker or empire poker.. the account summary for party poker only goes back for a month anyway. Past that and you can't access it.

[Wake up CALL]

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I will be paying taxes on most of my winnings.

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Ha! Fat chance of that happening!

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I rarely play B&M and when I have, I didn't keep track of the necessary info that I needed to report in my taxes. My winnings have been unsubstantial so I won't be reporting them.

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Nice rationalization, let me know if that line works well for you during the audit.


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I also will not be reporting my ring game play. After finding out I'm a losing player at 5/10 6-max I'm slightly above even for the year. I won't be reporting this because it will increase my gross income a little over $6,000. I justify not reporting ring game play because my net income for all of ring play is only a couple hundred dollars.

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So you feel it is the fault of the IRS because your ring game play sux? Man, now I have heard it all.

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While it may not be 100% legal, I don't feel my tax bracket should be increased by gambling that I didn't really "win".

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Actually you really did win it, you just weren't skillful enough to hang on to it.


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I will be reporting all bonuses, rakeback, and tournament play. The amounts are significant enough that even if I wanted to hide it, I would be leaving a trail that would be found in the event I was audited.

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Basically you are saying, "Darn, I'd cheat here too if I wasn't sure I'd be caught." Right?


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I have gone up against the IRS before and lost.

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There is justice in the world after all.

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I don't look forward to doing it again.

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Yet you are willing to do it anyway. The definition of insanity: Doing the same thing over and over again and expecting a different result. Or is that the definition of a fish? Perhaps both.

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Essentially I was naive and used a "crooked" tax agency who wrote off a bunch of stuff that I shouldn't have. "Oh you work in computers, we'll just deduct your home computer and part of your room as work space". I didn't get audited. I got a notice saying that I owed x dollars. I could pay or they would audit me. I paid. They came after me slightly less than 3 years after I filed. Right before the deadline.

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Right, sure it was someone elses' fault. We understand, you really really meant to pay your taxes then but now you feel like it is OK not to do so. GOTCHA!

Please let us know how these feelings work out for you. Perhaps a 1-900-IFEELYOURPAIN hotline will be in your future. If so be sure to keep your massive profits in an offshore account, tax-free you know.

[Uncleben327]

I would like to inform all of you worry warts out there that 1/3 of all Americans either intentionally or accidently pay there taxes illegally. Also businesses are MUCH more likely to be audited than are citizens. The united States Also has nearly three hundred million people. Although internted gambling may start to piss off uncle sam and they may decide to audit the players who are reporting.{Atleast more frequently than those who aren't} It would be alot easier to catch those who are reporting than go through millions of citizens financial records to find the few thousand individuals who are actually cheating the government out of a measly 50 grand.Because the irs will know that they can slap a fine on you just because of the uncertanty of what is to be defined as a poker session.