Still working on 2006 Taxes

[TruFloridaGator]

Should I be filing taxes based on this information?
These are all round figures

Winnings:
180k

Losses:
170k

Net:
10k

Cashed out:
4.5k

[RoundGuy]

[ QUOTE ]
Should I be filing taxes based on this information?

[/ QUOTE ]
Assuming you are a recreational player:

[ QUOTE ]
Winnings:
180k

Losses:
170k

[/ QUOTE ]
Yes.

[ QUOTE ]
Net:
10k

Cashed out:
4.5k

[/ QUOTE ]
No.

[Orlando Salazar]

Pay tax on cashed out winnings an claim ingorance on the rest. IRS has a history of lenience when people attempt to pay taxes but make "mistakes". At most, you pay some interest and small fees.

[oldbookguy]

You cannot 'net' gambling winnings.
Winning go on one line, losses in the dedustions section of the itemized deductions.

obg


[ QUOTE ]
Should I be filing taxes based on this information?
These are all round figures

Winnings:
180k

Losses:
170k

Net:
10k

Cashed out:
4.5k

[/ QUOTE ]

[kagame]

f this just do net

[ilikeaces86_]

net it up.

[hlacheen]

Isn't netting illegal unless pro?

[Lottery Larry]

yes, it is.

[oldbookguy]

Netting is illegal even for a pro.

They place all winnings on one line, fill out a business form C expenses, you would simply put losses on an itemized deduction line (no hotel, meal, travel, ect. deductions). The latter deductions are the primary differences.

There are requirements though to be considered a pro.

obg

[kidpokeher]

Ok, I'm lost. So you claim the winnings on one form and the losses on another. What's the difference as far as the actual amount of tax you would pay?

From this site:
""I can net my gambling wins and losses." Some gamblers can net their wins and losses—if they are professional gamblers. Most gamblers, however, must put their gambling income on line 21 (Other Income) and take their losses, up to the amount of their winnings, as an itemized deduction on Schedule A. This deduction is not subject to the 2% AGI limitation."

http://www.gambling-law-us.com/Articles-Notes/online-gambling-tax.htm

[Merkle]

It should be noted that if you net your winnings as a pro, then the net profit is subject to self employment taxes in addition to income taxes. (esentially the self employed version of fica and medicare)

[PokeReader]

[ QUOTE ]
Ok, I'm lost. So you claim the winnings on one form and the losses on another. What's the difference as far as the actual amount of tax you would pay?

From this site:
""I can net my gambling wins and losses." Some gamblers can net their wins and losses—if they are professional gamblers. Most gamblers, however, must put their gambling income on line 21 (Other Income) and take their losses, up to the amount of their winnings, as an itemized deduction on Schedule A. This deduction is not subject to the 2% AGI limitation."

http://www.gambling-law-us.com/Articles-Notes/online-gambling-tax.htm

[/ QUOTE ]

What this is talking about is not netting losses, but itemizing them, which you can do if you itemize your taxes as an amateur. DO NOT NET. You can itemize, which will get you some deductibility, if you do not take the standard deduction. Some states taxes also do not allow deduction of gambling loses.

[iceman5]

It is not "illegal" to net your winnings and losses.

"Illegal" implies that there is a law against doing something and the mere act of doing it will cause you to be arrested and punished (ie: jailed).

If you net your wins and losses as a recreational player, your taxes will be filed improperly but not illegally. You cant be arrested or jailed for merely improperly filing your taxes.

OK, so Im a nit about this, but it gets old reading tax advice from every Tom, Dick and Harry who just spout out anything right off the top of their head.

A very high percentage of tax advice I read here is just flat wrong. In this case, he just misworded it, but in alot of cases the advice is flat wrong.