[thing85]

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I just wonder if WHEN you get your money, the 1099 is going to come with it. You can then prove with a win/loss record (like at a B&M casino) you didn't make a profit. The assumption is you did. I work at a Casino. You can cash out as much as you want and not pay taxes from table games. BUT at 10,000 a CTR (cash transaction report) is sent to the IRS. Not showing you made anything, but rather showing you took 10,000 in cash and now the gov has a record. I'm sure an audit is on the way if nothing is claimed as a win/loss.

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No, this is again mostly false information.

How the [censored] is the IRS going to send everyone a 1099? Do you think they can accurately measure the unreported income earned by every individual through their NETeller accounts? Theoretically, yes. Practically, no.

I'm not arguing that the IRS is incapable of auditing maybe 5% of US NETeller customers (and even this % might be generous). The IRS simply does not have the manpower to complete the audits necessary to create both 1099 statements and further research to compare NETeller's information with previously reported tax information.

Also, money transferred through NETeller (in or out) does not constitute income. If you transfer $1,000 on Stars to your brother as a gift, this is not 1099 income (or necessarily any income at all - see gift tax rules for further information). Also, once money leaves NETeller onto a gambling site, the IRS cannot tell your gambling winnings/losses. In an audit, they can ask you to provide this information (and you have to), but they are not going to try and track down this information for thousands and thousands of people.

It's just not realistic.