Observations from Official Poker Rankings

[PoineDexter]

Hey BigAl

I don't think anyone is bashing you (I hope not) but I'm sure that many of the folks who think they can make a living are far less informed than you. I like the "can't afford not too" line. Even so you'll still get detractors. Some folks will argue that full time (profitable) poker has huge downside (anti-social aspect, risk, personal credit issues etc). It's a personal thing so the debate will never be resolved.

[PoineDexter]

I will reiterate what I said early in the thread. I didn't intend this to lead to posters flaming one another. Everybody has an opinion on the philosophy of playing poker for a living and they will vary from person to person. My intent was to collect some thoughts and data to attempt to lay out what one needs to accomplish (consistently) to be able to play poker for sustainable profit. That's all.

Easy, fellas.

[BigAlK]

[ QUOTE ]
By saying it's incorrect and ill informed are you assuming I'm American? ... because that's not a correct assumption hence the "I THINK" in my post.

Self emplyed people also have a hard time getting loans for things they don't claim on their yearly income taxes... you cannot borrow on what you cannot prove exists without existing collateral or a co-signer. Anywhere. Either claim online winnings as winnings and don't list the source, and pay tax, or it doesn't exist.

But thanks for assuming I'm an idiot. And if you don't care about this line of discussion becuase it wasn't the OPs original intent, you can just end it here.

[/ QUOTE ]

Fair enough. I missed the "I think" part as I'm sure a lot of people who need to know would too. Technically on-line winnings are taxable and should be included on your income tax in the US. It isn't clear that on-line poker is illegal. However from a tax perspective even illegal income is taxable. In the past that's how some high profile gangsters (Capone or Dillinger) were finally arrested. They couldn't prove they had committed any crimes except tax evasion. I stand by my ill-informed comment, it was, but apologize for how it came across.

I agree this is extraneous to the subject of the thread. If anyone has questions regarding income tax on poker (online or other) in the US the legislation forum has lots of discussion on the subject.

[BigAlK]

[ QUOTE ]
Hey BigAl

I don't think anyone is bashing you (I hope not) but I'm sure that many of the folks who think they can make a living are far less informed than you. I like the "can't afford not too" line. Even so you'll still get detractors. Some folks will argue that full time (profitable) poker has huge downside (anti-social aspect, risk, personal credit issues etc). It's a personal thing so the debate will never be resolved.

[/ QUOTE ]

I didn't feel like I was getting bashed except for in one post where it was probably deserved. I think the thread has taken a natural evolution from "can I make a living at this" to also include other factors to consider. The items you list above are all factors that anyone needs to consider as well. Obviously all of them depend on a person's specific situation. There is no one-size-fits-all answer.

[BigAlK]

I should point out that I assume JoeyJoJo's post is spot-on if you live in the UK. Although I believe a large percentage of 2+2 posters are in the US and would assume any comments regarding tax treatment of poker income pertains to them the treatment of poker income is going to differ from country to country.

[JoeyJoJo Shabadu]

[ QUOTE ]
I should point out that I assume JoeyJoJo's post is spot-on if you live in the UK. Although I believe a large percentage of 2+2 posters are in the US and would assume any comments regarding tax treatment of poker income pertains to them the treatment of poker income is going to differ from country to country.

[/ QUOTE ]

Canada. And for at least here..they don't tax gambling winnings or lottery winnings here. We can even get back generally what they hold back in Vegas as non-citizens of the US.

... but there is a weasel clause about the frequency and other sources of income where Revenue Canada can say you are only in the "business of gambling" and then they tax you.

[PoineDexter]

I did a few calculations on the data from Official Poker Rankings. This was a small sample but ALL of the ones I did conformed to the formula. The purpose was to figure out what you needed to do to make a living at MTT poker and here it is:

You need your current ROI, ABI and GP (games played per month).
Income = (ROI/100)*(ABI/30)*(GP/100)*36,000

This formula got accidentally corrupted as the 36K figure is annualized but the GP is monthly but in a funny twist it works. I haven't figured out why yet.

I'll leave it up to the individual to calculate the $$/hr which will vary based on the number of tables you play but it obviously has to be taken into account. It is clear though that you need to multi-table to stay below "full time" hours (37.5 per week).

I'll also leave it up to the individual to estimate their ROI. ABI and GP are known and controllable by the player whereas ROI is a function of skill. What is the ROI that you can expect CONSISTENTLY (ie. factored for variance). If you move your ABI up what will happen to your ROI? If you add a third table what will happen to your ROI?

[BigAlK]

[ QUOTE ]
You need your current ROI, ABI and GP (games played per month).
Income = (ROI/100)*(ABI/30)*(GP/100)*36,000

This formula got accidentally corrupted as the 36K figure is annualized but the GP is monthly but in a funny twist it works. I haven't figured out why yet.

[/ QUOTE ]

The 36,000 offsets other errors in the formula. Try this one. It gives the same results and more accurately reflects the logic in what you're trying to do.

(ROI/100)*ABI*GP*12.

ROI needs to be divided by 100 to convert a percentage into decimal number between 0 and 1.0 (59%=.59). Multiplying by 12 annualizes the monthly number.

[PoineDexter]

I tried to figure out where the breakdown is but I'm too lazy. I wanted to keep the GP as it is as I think people have a better idea of average games per month vs games per year although you can extrapolate. The ROI is actually a multiplying factor not a percent (if you remember dividing by 100 was done becasue our assumption was that ROI = 100 was a good number for success although I think the average over time would be lower for most "pros").

Having said that (since the formula works so far) I'm just going to call 36,000 a "constant". Remember high school physics and chemistry when the teacher was explaining the Ideal Gas Law? pV=nRT (pressure x volume = amount of substance x "gas constant" x temperature. The "gas constant" is 8.314 and when you asked where that number came from your teacher would shrug and say "I dunno, it is what it is and it works".

That's what I'm claiming here. It's a universally accepted constant in the scientific community. Use it in your calculations and don't ask any questions. LOL

[PoineDexter]

I'm going to write a paper for Scientific America and put forward my theorem of MTT success. Maybe Lancet is a better choice? I'll decide when I complete the paper.

Look for it soon!