[I_C_ALL]

Just wanted to add that I've read setting up a corporation(S election or LLC) may "aid" in proving the gambling is professional. There would obviously need to be a profit(I read somewhere about 3 years worth), but this method would also decrease the self-employment tax burden. You are only required to pay self-employment tax on the amount you take as a salary. This can usually cut the amount of self-employment tax in half or quarter depending on how aggressive you want to be.

I'm told by CPAs that corporations are handled separately(1120S)from individual returns(1040) and that they are SIGNIFICANTLY less likely to be audited. I AM NOT RECOMMENDING NON-COMPLIANCE, but I would much rather pay my "fair share" and NOT get audited than try to argue with a grumpy agent about the definition of a session, not to mention the cost and stressed involved in an audit.