taxes?

[hidden_x_factor]

Hey all. Im looking to give this poker thing a try, and I read all this stuff on this forum having to do with good old tax's. Im just wondering what a poker player (poker's just something on the side for me, im nowhere near declaring it a full time job or anything) has to do in order to prevent legal trouble, if they are lucky enough to get audited. For example, would keeping track, in writing, how much I win/loose each day - along with the stats from pokertracker - be enough.

You don't need to give a long, detailed explanation, I just want to know what the IRS is looking for. Just how an ordinary poker player should keep records. That way when tax's come around or an audit, there shouldn't be tooo much trouble. I really do appreciate any insight, thank you in advance!!

[HeroInBlack]

Sadly, this is a very, very complicated subject that has been debated multiple times on 2+2. You would be smart to read a few of the tax threads of the past and make up your mind about how to handle your specific situation. CPA Ann-Margaret Johnston wrote a book about paying taxes on poker winnings that you may want to read.

To find the 2+2 threads, go to google and click advanced search. Put twoplustwo.com in the domain name field and taxes in the search box. Then get out the popcorn.

[BubbaDogg1]

Not an expert here, but IMO if it is just a hobby for you then you probably aren't withdrawing any large amounts. If you keep most of it online it shouldn't matter.

Don't ask, don't tell. (wink,wink)

[SellingtheDrama]

search for poster "Russ Fox" - he's a CPA and a genuine (unlike us) expert in gambling/tax issues.

[Poker Clif]

[ QUOTE ]
search for poster "Russ Fox" - he's a CPA and a genuine (unlike us) expert in gambling/tax issues.

[/ QUOTE ]

One important thing is to keep good records.

This nay just be a hobby for you, then one day you enter a $3 online tournament, have some amazing luck, and win $500 dollars or more. That is taxable income, and gambling is something that the IRS takes interest in, if for no other reason than it's a cash business, and people cheat on their taxes.

Until a few years ago, most waitresses (and waiters, of course) routinely underreported their tips. The IRS got so fed up that they finally required that all waitresses count a certage percentage of their wages as tips, whether their tips were that big or not. DON'T LIE TO THE IRS. THEY DON'T GET MAD, THEY GET EVEN.

Here are a few things to consider when dealing with the IRS.

1. Gambling winnings are taxable income. That includes poker. That included coins coming out of a slot machine. This included any bonuses or rakeback that you get from a site. (You should have a column for miscellaneou income on your spreadsheet).

When form 1040 asks for "other income" they mean ALL other income.

2. Keep good records.

A simple spreadsheet should be fine. It's not hard to put every cash game session, and every tournament, on a spreadsheet which will nicely total all of the results. If the IRS has any questions and you have decent records, 99% of the time you'll be all set.

If you have reported something incorrectly, they make ask you to change it, and you may owe a few bucks in taxes. But that's all that will happen. If is not worth an IT
RS agent's time and money to do a full audit to try to wring another $100 out of you.

3. By all means get the book mentioned in this thread. It actually a fairly easy read, only about 200 pages, and it should help you out quite a bit.

If you get the book, and check out the accountant on here, you will have advice from two poker-playing accountants. I can't imagine better sources for everything that you need to know.

Good luck!

[hidden_x_factor]

thank you veryyyyy much!

[Poker Clif]

[ QUOTE ]
thank you veryyyyy much!

[/ QUOTE ]

You are very welcome.