Advice my Tax Attourney (CPA) gave me

[Nomad84]

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It's each session.
And the definition of a session is still in 'grey area' status.

Counting each 'day' gambled as a total session is probably reasonable (although some disagree with that).

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Its not a grey area according to the IRS's current definitions. A session is a single table. The table must be documented. Yes it should be a grey area, but alas its not. Hopefully the IRS will wake up soon.

TT [img]/images/graemlins/club.gif[/img]

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Your facts are incorrect. A session is not necessarily a single table in the online realm. Multiple tables running simultaneously the same game/limit can count as one session. I'm not sure if this would apply to multiple platforms (UB & Party eg) but I kind of doubt it.

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While I agree about what constitutes a session in my mind, I'd really like to see your source for this statement.

[LinusKS]

The rule is intended to keep people from claiming losses on schedule C's, not to prevent them from claiming income.

Nobody who starts a business has five years of records before they start it. I've submitted schedule C's for the past 10 years - there's no rule about 2 out of 5 years as long as you're reporting income.

Again, it's when you report losses that the IRS begins to take a closer look at you -- it's the only way to keep folks from perpetually reporting losses from their stamp collecting "business," their fishing-on-the-weekends "business," and all other things they like to do in their spare time (aka hobbies).

Again, you don't need 5 years' records, business cards, or any of those other things as long as you're paying taxes on income, rather than trying to deduct losses.

[JBB]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
It's each session.
And the definition of a session is still in 'grey area' status.

Counting each 'day' gambled as a total session is probably reasonable (although some disagree with that).

[/ QUOTE ]

Its not a grey area according to the IRS's current definitions. A session is a single table. The table must be documented. Yes it should be a grey area, but alas its not. Hopefully the IRS will wake up soon.

TT [img]/images/graemlins/club.gif[/img]

[/ QUOTE ]

Your facts are incorrect. A session is not necessarily a single table in the online realm. Multiple tables running simultaneously the same game/limit can count as one session. I'm not sure if this would apply to multiple platforms (UB & Party eg) but I kind of doubt it.

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While I agree about what constitutes a session in my mind, I'd really like to see your source for this statement.

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It comes from a post made by GrannyMae last year around tax time. It's a link to some tax professionals' site who specialize in Gambling/poker. I'll provide the link whe nI get home, as it's on that computer. PM me if i forget.

[Kevin]

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That makes no sense but I'm willing to be educated, my take is that the losses as deductions caused them to be less than the losses, were these straight losses or was the travel etc involved?

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The child tax is $1,000 per kid in tax credit (not deduction) and it phases out as AGI gets higher

For example:
2004 Job taxable income (after 401k, health insurance, etc):
$95,000
Poker Winning Sessions: $45,000

Total AGI $140,000

Child Tax Credit at $95,000 taxable - $2,000 ($1,000 per kid)

Child Tax Credit at $125,000 taxable (netted poker earning) $1400 ($700 per kid - $300 phased out)

Child Tax Credit at $140,000 taxable (grossed winnings with $15,000 in deductions still to be realized) $600 (300 per kid - $700 phased out)

2005 Job taxable income (after 401k, health insurance, etc):
$105,000
Poker Winning Sessions: $56,000

Total AGI $161,000

Child Tax Credit at $105,000 taxable - $2,000 ($1,000 per kid)

Child Tax Credit at $135,000 taxable (netted poker earning) $1200 ($600 per kid - $400 phased out)

Child Tax Credit at $161,000 taxable (grossed winnings with $26,000 in deductions still to be realized) $0 (0 per kid - $1000 per kid totally phased out)

So because the AGI is showing at $161,000 versus $135,000 (the real amount that was made for the year job + poker) I lose $1200 in tax credit. I have my paycheck clobbered with with holdings to save owing a ton at the end of the year. In this case, I would have gotten $2100 back from federal if the amount was netted - due to losing the child tax credit, it is $900.

These are estimates on the phasing out as I could not find it on the IRS site.

From the IRS site:
The credit is limited if your modified adjusted gross income is above a certain amount. The amount at which this phase-out begins varies depending on your filing status:

* Married Filing Jointly $110,000
* Married Filing Separately $55,000
* All others $75,000


Hope that clears it up