Ed Miller's Tax Article

[Nomad84]

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I don't see what the difference is between adding up the gross winnings and losses per session and just putting down the net total as other income. It seems like I'm going to come up with a net of $7000 in net income either way I slice it. Sorry if I'm dense on this.

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The IRS says that you cannot just use the net. You have to follow their rules. The effect is that if you aren't itemizing, you will pay taxes on an extra $3000, so there is a big difference, and it sucks. There is more to it, but I don't know enough about it to really expand on it.

[MyTurn2Raise]

Russ, I read the following on your site
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Professional gamblers have a business. They file their gambling results on Schedule C. Their wins and losses are netted, they may deduct necessary and reasonable expenses (i.e. mileage and travel, computer ISP, books and other training materials, etc.).

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So, the net amount of winnings should go on line 1 of 1040C (Gross receipts or sales) if one is filing professionally? I have all my sessions from both online and live loaded on excel and saved in multiple spots. I'm just wondering how to present that info.
It's my first year filing as a professional and I want to start on the right foot.

Additionally, can one use the 1040C-EZ as a pro gambler if their expenses are under $5k?

thanks so much

BTW-great book and website

[kleos]

Are gains realized immediately? lets say a miracle happens I run my stars acct up $5k in 2006, but I never withdraw any money (electronicly bring it into the US). Do you pay taxes on it that year, or do I wait till I bring it back to this country?

[*TT*]

[ QUOTE ]
Are gains realized immediately? lets say a miracle happens I run my stars acct up $5k in 2006, but I never withdraw any money (electronicly bring it into the US). Do you pay taxes on it that year, or do I wait till I bring it back to this country?

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Yes, they are realized immediately. It is income, not tax differed savings.


TT

[SumZero]

Around regulation someone else on another forum mentioned that you may have to file TD 90.22-1 forms as well or risk a $10K+ fine. My quick googling suggests this is a forum detailing off shore financial accounts. Looks like it is targeted at banks (although list other types of financial accounts as well), and you only have to file if all you off shore accounts total $10K, and it seems ambiguous if an online poker site or sports betting site counts as an account.

Any of the CPA/law folks know about that?