more stupid tax questions

[Brightside]

hey guys i need a little help here. i have been playing poker as my sole source of income for about 3 years now and i have never filed taxes, (probly stupid) but the previous two years i have played all cash games and never really made a lot of money to report. this year however i have roughly 120k in live tourney winnings that the gov knows about. i have also cashed out online money to pay my moderate bills, but i have never cashed more than 1500 into my bank account out of my neteller every 2 or 3 weeks (don't know if that matters or not?) Now, i own my own "business" but it's not really a business, i just got myself incorporated and have a business credit card that i charge stuff like airfare and hotel onto (i travel alot for poker so there is quite a bit charged on there over the course of a year) i also save all tourney receipts which will add up to probly 50k. Obviously i need to pay taxes this year and my question is what is the best way to go about doing it while having to pay as little as possible? also would it be best to get a "gambler type" accountant or just to go to a suit and tie guy from H&R? Thanks for the help and sorry this is so long with me rambling on.

[ChexNFX]

http://www.pocketfives.com/DD6E4B33-181C-4E60-80FA-433BE6A8AF8C.aspx

[SlapPappy]

What did you do for the previous two years just put zero or not file at all?

[jlkrusty]

This is how I understand it: Not filing at all is one of the worst mistakes you can make. If you file, and the IRS accepts your return (i.e., you are not audited), then your obligation on saving old records goes way down (after 3-5 years or something like that).

If you don't file, however, your obligation on proving everything never expires. Your only excuse would be that you did not make enough income to mandate a filing. However, that does not sound like the case for you for the past couple of years.

So, that said, you should not only file this year, but file the previous unfiled years as well. You should go talk to a good accountant about this.

Here are two things I keep in mind when finding an accountant:

1. An accountant is bad if he tells you to do all sorts of shady stuff because it is so unlikely you will be audited. Some gambler type accountants might be in this category, and you should steer clear of them. Your tax return needs to be prepared so that you can defend yourself in case of an audit.

2. An accountant that has no creative ideas, and just wants to send in a "cookie cutter" return is going to cost you a lot of money in the long run. Sure, your return is audit proof, but you end up paying a lot of unecessary taxes as well. H&R block agents are often like this.

So, look for someone in between 1 and 2. Look for someone intelligent, smart, and prudent. Like almost any profession, there is a wide range of aptitude in the field of tax accountants.

[TheMetetron]

This is a situation where you need an accountant and a tax attorney. Pay them to do your returns this year and tell you what is up. In future years, you can probably do it yourself.