Taxes - Is it even worth it to win small big money

[Dan Abnormal]

While playing at teh cardroom today was reading ANTE UP magazine and they brought up something I never really thought about and I dont know if it just florida taxes or USA taxes all together

Basically what you win is counting as income and what you lose is counted just as a deduction and unless you BIG TIME MONEY this could be a big problem for some people for example

IN A YEAR YOU WIN $130,000 on your winning sesssions and on your losing sessions you end up losing $110,000

YOu have to claim $130K as income but the losing sesssions are just a claimed deduction of $110K which if I understand right is like night and day as your winnings arent 20K they are 130K of added income so YOU WOULD BE F'D ROYALLY LIKE THIS

$130K added income $110K as a loss deduction (which is nothing like taxable income) but the 130K puts you in an entirely different tax bracket

DOES ANYONE REALLY KNOW TAX LAW, that kind of deduction isnt gonna do much to offset that extra income does it

[Peteyweestro]

Hey Rob, i aint no tax lawyer or nothing but if that is true and it sounds like it could be, then thats more the reason to stay playing in backrooms and only places where they can't see the earned income Now i know at the horse races i believe anything over $500 needs to be cashed at a special irs window so they can keep track of your larger wins but its way easier to pick up loser tickets to offset your winnings seeing as how they are all over the ground

[scrawnybob]

hi

this might help ...

Beginners' Guide to Online Poker - How to compute income – winning and losing sessions

basically afiaks US has a very wierd tax system (in the UK we dont pay tax on gambling as logically any money we have for gambling has already been taxed) anyway back to US setup

I think you problem is that your losses will count as deductions which can affect the other things you are allowed to put down as deductions

the other thing you need to bear in mind is the wins / losses are done over sessions (which they dont define clearly) best taken as a daily net win/loss so in theory you need to keep track of your wins and losses

hope the article is helpful

cheers SB

[madjek]

$130K added income $110K as a loss deduction (which is nothing like taxable income) but the 130K puts you in an entirely different tax bracket

DOES ANYONE REALLY KNOW TAX LAW, that kind of deduction isnt gonna do much to offset that extra income does it

the ded. is tax income, ded is subtracted from taxable income. Like SB said though, the problem is your other deductions. As your gross income rises, your allowable deductions in many cases are lowered. Most of us that own a home itemize our deductions anyway so we are already above standard ded. so the losses would just increase it by that much unless like I said, our gross income is too high that it reduces our other deductions.
After reading SB's link, think it would definately make sense to play as a pro if you play a lot.

[Dan Abnormal]

Peter- TOo FUnny Its not like im going to have to worry about these problems anytime soon judging by my last 2 live sessions.

SB's take on the UK seems to be right on target (in the UK we dont pay tax on gambling as logically any money we have for gambling has already been taxed)

Ive never understood the way things are in the US as we are taxed on the money we earned but then we are taxed on everything we buy and do (FLORIDA ALONE HAS a 11% tourist tax meaning 11% tax to out of staters for every motel ). I have never understood how we can pay tax on what we earn and then tax on what we buy, it does seem like double dipping, (OK A ROB BAD EXAMPLE COMING) I have always looked at sorta like the the cable system, We are paying for premium channels the cable companies for premium channels and seems they should be commercial free yet they bigger the premium station the more they make on commercials which seems like double dipping, if the commercials are paying for the network then shouldnt it be part of regular cable

BUt like I said I wish I was on the verge of having these tax problems but if some reason I took down one of these 170 person MTT's $65 BUy in's I think $50 of that goes into the game so your looking at an $8K prize split

Might have to look for one of these backroom games Petey brought up, so I can post, WOW I took down a big underground game last night and when I tried to collect I got 20 stab wounds and had to run for my life LOL. (YO WANT YO MONEY WHITE BOY COME GET IT)

HEY BOB VERY ODD YOUR LINK and THE ANTE UP ARTICLE ARE WORD FOR WORD I only changed the 120K losses to $110K guess they all came from the IRS PUB 529,

[scrawnybob]

hi

The UK still has VAT at 20% (on most things you buy) so we dont get off, in that sense we are "double taxed" too

but gambling winnings are not taxed in UK

still I'm glad we dont have the US sytem is sounds even more overly complicated than our tax returns

cheers SB

[Peteyweestro]

Yes Bob, the tax system here is way screwed, but what can we do ? Rob that was funny as hell, about the white boy,lol too much brother

[rgchan]

One advantage of living in the Cold North. Canada doesn,t tax lottery winnings 33% like the US does.Play in a Canadian casino and you win 10k in a slot machine again no taxes.I remember in Vegas some-one in my group won over 1K on a slot machine and lights flashing, etc.And he couldn,t claim anything until the Casino took the taxes off the Win.
The US is hungry for there share of the online gambling profits.It,s getting scary.But does anyone other than Professional Poker player claim online Poker profits on there income tax returns ??
Rg

[Dan Abnormal]

BUT DUDE its like a MINUS 32 there year round, the money would freeze before you could spend it.

[jessica30]

Hope it will not happen. Its OK if you have some small winning because You cannot really notice it, but as long as you have big winnings, taxes amount will also increase and it will be like a huge loss on your end. Thats is why other people will prefer playing it secretly.