This should end all of the false claims about paying US taxes on poker - Page 11

adanthar · #**101** 02-01-2007, 11:36 PM

Okay, you seem knowledgeable enough on this that barring somebody else putting down some definite authority, I'll defer. It's not what I remember reading, but there are no regs on any of this anyway so I'm pretty sure you're not going to jail for arguing this, either.

However, even under this definition, an outright bonus (like the one that Stars lets you buy) is taxable...

RonMexico · #**102** 02-01-2007, 11:45 PM

Another tax post filled with myopic disinformation and impractical paranoia. Every single one of these threads has a poster who repeatedly says something like, "Have a nice time explaining that to the IRS when they show up at your doorstep." If you want to spew this [censored] garbage, perhaps you should make a list of the countless thousands who were audited after making a good faith claim on internet poker winnings. Also, most of the "definitive" interpretations of a session are laughable since the wording was clearly constructed in relation to B&M games. The IRS has no clear definition for internet gaming sessions--neither should you.

(P.S. For those of you suggesting it would be proper to report 73,000 sessions of play...wow)

cardcounter0 · #**103** 02-01-2007, 11:51 PM

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Hypothetical situation

Say i cash out 3k in winnings from stars and use an e wallet to directly deposit it into my bank account...i then go to the bank and cash out the full 3k. Tax time comes around...what if i "say" that i lost 2k or w/e amount playing in live games (it can be over lots of sessions or just one) but actually just held onto the cash. What if these live games were just home games? What if i said they were at some random casino? I mean, seriously...how can they find out?

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By asking you to back up your claims by showing a log book or records where you have recorded the times, dates, places, amounts, etc. where you have lost this money. They can then do analysis on this log to see if it was indeed created over the time period, or something you made up all at once.

They might want further proof also, like someone to verify that you were indeed at those places at those times. No logs? No records of the loss? Well, then you might as well have just held on to the money, because your deduction will be disallowed.

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ok...so i think i lost $800 tonight in a local game. Next week I plan on losing 600 at harrahs. Maybe ill win a few hundred the week after that...no one knows me at these games, no one knows if im there or not.

im definitely not saying that i do this...but doesnt it just seem like such an easy way around things?

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READ THE IRS REGULATIONS IN THIS THREAD AGAIN. You can't "think" you lost, you can't "plan" you lost. You need to keep records. You need a LOG of your wins and losses in order to use them. The IRS tells you what information you need to keep in these records. If it looks fishy, they will ask for back-up proof.

AmIAFishy2? · #**104** 02-01-2007, 11:59 PM

Please dont shout...im asking a serious question. Obviously anyone who did this would log all of these sessions on random days, on random nights whenever they felt like it...they would be careful to make it not look fishy, theyd do it in smallish amounts, and mix in some wins as well. They would write down all the information that was asked....as for back up proof? are they going to ask for back up proof on all your winnings too? Please...theres no way anyone is putting together all of this "proof".

please dont insult me, im just asking an honest question...how wouldnt this work?

cardcounter0 · #**105** 02-02-2007, 12:00 AM

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However, even under this definition, an outright bonus (like the one that Stars lets you buy) is taxable...

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You are correct. If you get comped cash, it is taxable. If you use the FPPs to get multiple IPODs, and EBAY them, that is probably taxable too.

I used to get RFB + Airfare to Las Vegas comped to me. If the casino made the air ticket arrangements, it is a comp and not taxable. If I bought the plane ticket and the casino hands me cash to reimburse me for the airfare, it is taxable.

broiler · #**106** 02-02-2007, 12:07 AM

Libutti v Comissioner includes many non-cash comp items as taxable to the taxpayer. The list of items given to the whale include: automobiles, vacations, jewelry, champagne and entertainment tickets.

A quick search through my research came up with this unsourced quote: Gambling casinos often provide their customers with complimentary goods and services (“comps”) to encourage future patronage. IRS says that extraordinary comps, such as autos and jewelry, are taxable income. But it reserved the question of whether “normal comps,” such as food, drink, lodging, and entertainment, can be excluded from income as purchase price adjustments.

Zele · #**107** 02-02-2007, 12:07 AM

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please dont insult me, im just asking an honest question...how wouldnt this work?

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It probably would, but if it didn't you'd be in deep - much deeper than if you had just left the income off your return (which is also a bad idea).

adanthar · #**108** 02-02-2007, 12:09 AM

Okay, that makes sense - I probably missed the distinction the first time around since it wasn't relevant for me at the time. So it's tied to profit motive vs. outright free stuff? Thanks.

edit: lol, someone cited authority while I was typing. god I hate tax law.

Fishy: Yes, you can get away with small scale tax fraud and probably not get caught. Do you feel lucky?

cardcounter0 · #**109** 02-02-2007, 12:13 AM

[ QUOTE ]
Please dont shout...im asking a serious question. Obviously anyone who did this would log all of these sessions on random days, on random nights whenever they felt like it...they would be careful to make it not look fishy, theyd do it in smallish amounts, and mix in some wins as well. They would write down all the information that was asked....as for back up proof? are they going to ask for back up proof on all your winnings too? Please...theres no way anyone is putting together all of this "proof".

please dont insult me, im just asking an honest question...how wouldnt this work?

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You might google some tax court cases of big winners trying to doctor up some "proof" of losses, and what happened to them. It is rather easy to determine if a log book has been created in one sitting or was actually done day by day over time. If you are claiming you were at a casino at a certain table for part of your losses, do you have any credit card receipts putting you in the area? A casino players card showing activity from that date? How about a call to the pit boss to see if they ever heard of you? Oh, they got a record of a credit card transaction a hundred miles away when you were supposed to be at the track?

And no they don't want any further proof of winnings. they got that, that is what you are being taxed on, they will just take your word for winnings. Of course, if they do find any winnings that you have not claimed ... well, you are behind the 8-ball again.

RonMexico · #**110** 02-02-2007, 12:23 AM

Another tax post filled with myopic disinformation and impractical paranoia. Every single one of these threads has a poster who repeatedly says something like, "Have a nice time explaining that to the IRS when they show up at your doorstep." If you want to spew this [censored] garbage, perhaps you should make a list of the countless thousands who were audited after making a good faith claim on internet poker winnings. Also, most of the "definitive" interpretations of a session are laughable since the wording was clearly constructed in relation to B&M games. The IRS has no clear definition for internet gaming sessions--neither should you.