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#1
04-07-2005, 12:41 PM
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How does this form of tax evasion sound?
Suppose you were taking a trip to Tahoe or AC or some gambling-oriented destination. Before you go, withdraw a large-ish, but less-than-10k amount from your checking acct. Obviously, save the withdrawl receipt. Conveniently "lose" all this money at blackjack, craps, etc. Then throw it in a shoebox/safe deposit box/under the mattress, and buy small stuff (groceries, CDs, etc) with that cash for the next several months, and reduce your taxable income.
Does anyone see any obvious problems here? Of course, you can't go buy a car with the cash, or anything big like that, but do you think the IRS is going to notice that you stopped buying groceries w/ credit card as frequently? 
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#2
04-07-2005, 12:46 PM
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Re: How does this form of tax evasion sound?
Gambling losses can only be deducted to the extent that they offset gambling income. If you declare winnings of $5000 and show other losses of $5000, you can deduct the full $5000 in losses. If you show no winnings, you cannot deduct any gambling losses.
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#3
04-07-2005, 12:49 PM
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Re: How does this form of tax evasion sound?
This amount of money is, we will presume, far less than total net gambling income. For sake of argument, let's say you have $50k total (winnings-losses) poker income by year's end, and you run this trick twice at $5k a pop.
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#4
04-07-2005, 12:50 PM
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Re: How does this form of tax evasion sound?
[ QUOTE ]
Suppose you were taking a trip to Tahoe or AC or some gambling-oriented destination. Before you go, withdraw a large-ish, but less-than-10k amount from your checking acct. Obviously, save the withdrawl receipt. Conveniently "lose" all this money at blackjack, craps, etc. Then throw it in a shoebox/safe deposit box/under the mattress, and buy small stuff (groceries, CDs, etc) with that cash for the next several months, and reduce your taxable income. Does anyone see any obvious problems here? Of course, you can't go buy a car with the cash, or anything big like that, but do you think the IRS is going to notice that you stopped buying groceries w/ credit card as frequently? [/ QUOTE ] And you document these losses to the IRS how? eastbay
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#6
04-07-2005, 12:55 PM
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Re: How does this form of tax evasion sound?
As I understand it, you can document losses under the 10k barrier with ATM receipts and withdrawl slips and the like.
Also, as with other gambling income, these forms of documentation only come into play during an audit... so they just have to be archived, not attached to a 1040, etc. Please correct me if I'm wrong.
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#7
04-07-2005, 01:15 PM
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Re: How does this form of tax evasion sound?
[ QUOTE ]
Suppose you were taking a trip to Tahoe or AC or some gambling-oriented destination. Before you go, withdraw a large-ish, but less-than-10k amount from your checking acct. Obviously, save the withdrawl receipt. Conveniently "lose" all this money at blackjack, craps, etc. Then throw it in a shoebox/safe deposit box/under the mattress, and buy small stuff (groceries, CDs, etc) with that cash for the next several months, and reduce your taxable income. Does anyone see any obvious problems here? Of course, you can't go buy a car with the cash, or anything big like that, but do you think the IRS is going to notice that you stopped buying groceries w/ credit card as frequently? [/ QUOTE ] It would have worked great for you, before this post.
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#8
04-07-2005, 01:22 PM
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Re: How does this form of tax evasion sound?
elaborate. do you really think the IRS is going to go try to figure out what online posts are mine? Also, even if they could definitively attribute this post to me, and saw that I "lost" 5k at Foxwoods a couple times, they still don't have proof that I have done anything wrong.
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#9
04-07-2005, 01:23 PM
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Re: How does this form of tax evasion sound?
I think that accross the mistake defense. That would be fraud, which is more likely to get a harsh punishment.
Others that are doing the right thing, but make mistakes in figuring taxes------are more likely to be given fines and interest punishment. All tax punishments arent jail time, but this one is might be one of those. For all tax advice....see a CPA or Attorney. Dont take advice from a message board. SFWUSC
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#10
04-07-2005, 01:25 PM
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Re: How does this form of tax evasion sound?
An awful lot of fraudulent bahavior. I guess it adds some versimilitude to your fraud to be able to show hotel receipts or whatever in the gambling destination.
But given that your documentation is mostly in your gambling journal, why not just periodically write in "Played poker today, lost 423 dollars". Embellish it a little if you want. I think most folks here would feel there's a difference between simply under reporting income and actually fabricating losses and documentation. But if you don't, then sure there's a ton of stuff you can do. --Zetack
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