Ways of reporting poker winnings

[yellowbastard]

I didn't make that much money in 2006 because I was in school for most of the year but my net poker winnings where more than what's on my W-2

Poker: $8300 ($33,500 winnings - $25,200 losses)
W-2: $4500

I did my taxes both ways last night and found that my tax liability increased by $819 when I used schedule C to report my poker winnings.

TL Schedule A way: $377
TL Schedule C way: $1196

Can someone point me to something from the IRS discussing how the poker income must be reported in my situation.

[matt777]

[ QUOTE ]
I didn't make that much money in 2006 because I was in school for most of the year but my net poker winnings where more than what's on my W-2

Poker: $8300 ($33,500 winnings - $25,200 losses)
W-2: $4500

I did my taxes both ways last night and found that my tax liability increased by $819 when I used schedule C to report my poker winnings.

TL Schedule A way: $377
TL Schedule C way: $1196

Can someone point me to something from the IRS discussing how the poker income must be reported in my situation.

[/ QUOTE ]

You may not have done this right. With the schedule C you will also get to take the standard deduction of ~$5,000. If you take the schedule A route, you will eat up the standard deduction.

Out of curiosity, what did you use to figure out your taxes?

[yellowbastard]

[ QUOTE ]
You may not have done this right. With the schedule C you will also get to take the standard deduction of ~$5,000. If you take the schedule A route, you will eat up the standard deduction.

Out of curiosity, what did you use to figure out your taxes?

[/ QUOTE ]

Downloaded the forms and figured it myself by hand.

When using schedule C I did take the standard deduction of $5150 but SE taxes on my $8290 in schedule c (poker) income was $1171!

When I do it the schedule A way, I take an itemized deduction of $25,340 instead of the standard deduction and do not pay anything in SE taxes.

[bav]

Sounds like you should do it the Schedule A way, then, fersure.

IRS docs: Pub17 is the catch-all, you can find references to gambling in various spots. Pub552 is about record keeping which tells ya 'xactly what the IRS expects you to be able to provide to back up your win/loss claims. Pub529 is about deductions and spells out gambling deductions.

And again, google for "professional gambler taxes" and you'll find a number of very useful and interesting articles.