Tax situation for non-professional gambler

[jdock99]

I am a full time student who does not have a job and survives solely on college loans, money saved up from previous work, and money given by relatives. In the year 2006 I had my first winning year ever gambling (online-poker), somewhere in the neighborhood of $30,000 I would guestimate. At no point in the year did I take any records. Probably the only way I could guestimate my "income" is by adding up the money I withdrew from Neteller and Party EFT's and subtract it from the money I put in.

Will this be good enough for the IRS? If I just give them a grand sum of how much I netted online. Or do I need to make up some elaborate records where I have my total wins and subract my losses?

Also, if there is any tax accountants who are willing to offer their professional services to help me file (at a low cost, I am a starving student) please IM me.

[RoundGuy]

[ QUOTE ]
Will this be good enough for the IRS? If I just give them a grand sum of how much I netted online. Or do I need to make up some elaborate records where I have my total wins and subract my losses?

[/ QUOTE ]
Good Lord, man. Have you even bothered to look at the current threads?

[MasterLJ]

I'll give the quick, dirty and not-specific answer (READ: An answer that would not save your ass if you were audited).

You must waive your standard deduction so that you can itemize
You must claim TOTAL net earnings
You must claim TOTAL net losses
You CANNOT net out your total earnings as a non-pro

So it would look something like Won: $100,000 Lost: $70,000

You can't be that hungry making $30k as a student. Just pay $200 to have someone do your taxes for you.

Now, if you get audited you are responsible to provide backup for your figures you gave the IRS, and they must be in the form of "sessions." You must take the aggregate wins and the aggregate losses from your gambling sessions and report those as total winnings AND total losses.

Example:

Session1 : -$100
Session2 : $300
Session3 : -$50
Session4 : $1000

WINNINGS: $1300
LOSSES: -$150

The IRS will in effect, "net them" for you.

[jdock99]

Thanks for the reply which I actually understood unlike most of the legal speak on this website. Just curious, anyone have a rough idea what % I would have to pay in taxes on this "income" considering

a) I did not have a job
b) Am a full time student living off of student loans

[Wake up CALL]

All you need to do is heed his advice, "Just pay $200 to have someone do your taxes for you."

[dollerAday]

Probably like 4k in federal taxes and another 1k in state taxes, it depends on what state you live in. Another thing to consider is whether or not you receive financial aid, because this will likely negatively affect that.