Poker Taxes (1 Viewer)

Prenders17

Prenders17

High Hand
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Looking for opinions. I know Uncle Sam would say that any gambling winnings are taxable, and I should pay my fair share. But let’s face it, if any of us made $20, we probably wouldn’t claim it. So for you guys, where’s the line? How much does it take before you’d pay taxes on you winnings?

For color, I’m a 38 yr old with a wife, two kids and a day job. My net profit from poker last year was around $6500.
 
Prenders17 said:
Looking for opinions. I know Uncle Sam would say that any gambling winnings are taxable, and I should pay my fair share. But let’s face it, if any of us made $20, we probably wouldn’t claim it. So for you guys, where’s the line? How much does it take before you’d pay taxes on you winnings?

For color, I’m a 38 yr old with a wife, two kids and a day job. My net profit from poker last year was around $6500.
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You are screwed! There is at least one IRS employee that is a member here.

But seriously, can you show any losses to offset? Casino games? Lottery tickets? Horse/dog track?

I wouldn’t worry too much about $6500, but I don’t know.
 
Prenders17 said:
Looking for opinions. I know Uncle Sam would say that any gambling winnings are taxable, and I should pay my fair share. But let’s face it, if any of us made $20, we probably wouldn’t claim it. So for you guys, where’s the line? How much does it take before you’d pay taxes on you winnings?

For color, I’m a 38 yr old with a wife, two kids and a day job. My net profit from poker last year was around $xx.
Click to expand...
I dont think I would post this information in a public forum.
 
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Prenders17 said:
Looking for opinions. I know Uncle Sam would say that any gambling winnings are taxable, and I should pay my fair share. But let’s face it, if any of us made $20, we probably wouldn’t claim it. So for you guys, where’s the line? How much does it take before you’d pay taxes on you winnings?

For color, I’m a 38 yr old with a wife, two kids and a day job. My net profit from poker last year was around $6500.
Click to expand...

I've seen lots of posts like this over the years on various poker forums. They're always a variation of the same theme: a dude who is looking for justification and/or weighing the probability that there will be consequences for failing to report gambling winnings to the IRS.

So I don't know what you do for a living and/or if you're expecting to receive a tax return, but the pros and cons are this: If you report the winnings, you probably get less of a tax return than you otherwise would have. If you don't, you risk the IRS fucking with you for years on end. Because once you're on their radar, you stay there.

25% of your winnings is roughly what $1600? Is it worth that amount of cash to live with the anxiety that the IRS can catch up with you for the next 7 years?

Talk to your tax pro about write-offs and all that jazz. But that aside, from my limited time getting to know the people here, I can safely say that PCF probably isn't the place to come to seek validation for poor tax decisions.
 
This subject is kind of silly. How is anyone to know how much some working stiff lost or won playing cards over the course of a year? L.M.A.O.

Claim the $6500 as income if your conscience bothers you.

Take the $6500 and find yourself a therapist if you are losing sleep at night worrying about the IRS boogeyman catching you.
 
I wouldn't report any of it, but then again I live in Canada and gambling winnings aren't taxable here unless your gambling is considered a business (ie. full time +EV gambler)

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$6,500 profited over many cash transfers (ie, poker game cash-outs)? With no documentation or way of tracing those transfers?

I'm sure there are people making way more off Craigslist furniture/garage-sale cash transactions in a given year who don't report their revenue.

I really wouldn't worry about it.

If you eventually quit your day job, go full-time poker-pro, and have a couple dozen five-figure cash deposits into your bank account over a given 12-month period, well... that's a completely different story.
 
timinater said:
I wouldn't report any of it, but then again I live in Canada and gambling winnings aren't taxable here unless your gambling is considered a business (ie. full time +EV gambler)
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Which is really how it should be. The problem with taxing gambling winnings is that you can't write off losses. If I am going to pay tax on a good year where I made 60k then I should also be able to write off a bad year where I lost 20k.

In regards to the OP I would pay more attention to the paper trail. If you won that money using cash then it is near impossible to prove even with an investigation. If you are playing online and there are deposits to your bank account then an audit would clearly show how much income you received from "x" casino.
 
Rhodeman77 said:
When the casino issues a 1099 for a jackpot type bonus that qualifies to do so.

Otherwise I broke even for the year. And all my guns went down in a tragic boating accident out on the lake. :bag:
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This^^^^^

curious to know if you are talking Casino winnings or home games. If your talking Casino winnings, then they will send you a 1099 if you qualify. If Home winnings.....well then you need a better poker face

I personally think taxing gambling income is BS (unless its your profession of course). Reminds of a meme I saw once about property taxes..."so I pay a yearly tax on something I bought with sales tax from my already taxed income....my punishment for being a productive member of society"
 
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My 2 cents.

I agree that reporting seems unnecessary, unless a 1099 is issued. Some might argue that this is in the same vein as fudging the purchase price of a used vehicle when getting it registered. Maybe, but in my view poker winnings are different UNLESS you are claiming losses on your taxes. If you’re claiming losses then you should also report your winnings.

Incidentally, I started this post with “my 2 cents.” That is exactly my winnings balance over my 40 years of playing poker...as far as you know.
: |
 
Personally, my poker earnings last year exceeded my primary job salary. I made some large cash deposits along the way as well in order to get the money into the bank. Therefore, there is no sense in not trying to claim everything, like I do every other year. The issue I'm having is I'm trying to determine if it's worth claiming professional status for the year or not.

We are trying to buy a house this year and some banks won't count my poker income unless I claim it as self employment income. Therefore I've been on the phone with accountants/banks nonstop for thr last month trying to figure everything out. My plan is to file first thing in February so we can use that tax return for thr mortgage application.

Either way I don't know why you'd want to fuck around with the IRS by not claiming something. Although I disagree with how poker is taxed, it just isn't worth the hassle.
 
Payback said:
Either way I don't know why you'd want to fuck around with the IRS by not claiming something. Although I disagree with how poker is taxed, it just isn't worth the hassle.
Click to expand...

I absolutely appreciate this position but it’s a matter of scale, wouldn’t you agree? In your case, where you’re talking significant money (with a paper trail) I would definitely follow your advice. But if we’re talking relatively small amounts accumulated over the course of a year...I don’t know. I guess it all boils down to risk appetite. If I’m not making sizable (and unattributable to employment, investments, etc.) bank deposits then the likelihood of IRS investigation is minimal IMO, and I’d be willing to roll the dice (so to speak). And with a clear conscience if losses aren’t claimed in “down” years.

Disclaimer: Not a lawyer, not a tax expert, and did not stay at a Holiday Inn Express last night.
 
As a totally unrelated anecdote, I once agreed to chop a casino poker tournament heads-up to make my payout $4999.
 
How would they even know you made the $6500 though? You aren't required to file paperwork to cash out for small amounts? If you made this over a year I'm guessing it was a series of smaller winnings.
 
raynmanas said:
As a totally unrelated anecdote, I once agreed to chop a casino poker tournament heads-up to make my payout $4999.
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I wonder if that could be construed as "structuring?"

From: https://www.irs.gov/irm/part4/irm_04-026-013
Structuring is the practice of conducting financial transactions in a specific pattern calculated to avoid the creation of certain records and reports required by the Bank Secrecy Act (BSA) and/or 26 USC 6050I (Form 8300).
 
sheikh617 said:
How would they even know you made the $6500 though? You aren't required to file paperwork to cash out for small amounts? If you made this over a year I'm guessing it was a series of smaller winnings.
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Yeah, that’s what I was getting at...but with way too many more words. : )
 
Shaggy said:
I wonder if that could be construed as "structuring?"

From: https://www.irs.gov/irm/part4/irm_04-026-013
Structuring is the practice of conducting financial transactions in a specific pattern calculated to avoid the creation of certain records and reports required by the Bank Secrecy Act (BSA) and/or 26 USC 6050I (Form 8300).
Click to expand...

I think structuring is specific to banking
transactions, but I'm no expert.

Also, I said this was totally unrelated. $4999 just happened to be my exact ICM equity.
 

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