[MrWookie]

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Just a quick statement/question:

I have cashed at several live tournaments including a close to 6 figure cash at this years WSOP. I have always just received a W2G form with no taxes taken at the time of the cash. I will pay taxes on those at the end of the year. What would be the difference with online poker?

What would prevent each site sending all US customers one W2G at the end of the year for their poker winnings on their site? Each site would have to monitor each players accounts for the whole year and send a W2G accordingly. We each would then pay taxes on this at the end of the year just like any other W2G. The online sites would be regulated and taxed like any other B&M casino. Obviously their increased costs would be passed down to the players through added rake or larger tourney fees.

Each site could send a yearly statement showing all deposit amounts, winnings, rake paid, tourney buyin fees, etc for tax purposes. Think of it like buying and selling stocks. You don't automatically pay taxes every time you buy and sell a stock during the year. You pay taxes or deduct taxes at the end of each year based on the overall profit or losses from buying and selling stocks.

Am I offbase here or missing something?

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This is exactly the vision I had. The site sends you a W2G every January with your gross winnings by session. Then you submit that along with the rest of your income tax stuff, which includes your itemized deductions. The online casinos (the ones based in the US, anyway) are taxed just like B&M casinos.