online poker and taxes.

[Smasharoo 0]

Let's keep in mind, for those of you who care, that we're talking about fraud, here. I know taxes suck, but cheating is still cheating. Fraud requires intent.To prove fraud you'd have to show intent to decieve on the part of the person not reporting **offshore** gamling winnings, which in itself is highly questionable if it's taxable.It's nearly impossible anyone would get prsecuted for fraud because of it, unless, again we're talking about relatively large sums of money or some sort of obvious intent to decieve, like putting your poker winnings in a seperate account under another name or something stupid like that.No judge is even going to let a case get started where the person accused of fraud says "I didn't realize it, I'm happy to pay what I owe."/shrug.Is it ethically wrong? Depends on your ethics I guess.I make neough playing that I bother to report it. If I made 5 grand a year the thought wouldn't even cross my mind.

[Nikki_N 17]

Let's keep in mind, for those of you who care, that we're talking about fraud, here. I know taxes suck, but cheating is still cheating.  Fraud requires intent.To prove fraud you'd have to show intent to decieve on the part of the person not reporting **offshore** gamling winnings, which in itself is highly questionable if it's taxable.It's nearly impossible anyone would get prsecuted for fraud because of it, unless, again we're talking about relatively large sums of money or some sort of obvious intent to decieve, like putting your poker winnings in a seperate account under another name or something stupid like that.No judge is even going to let a case get started where the person accused of fraud says "I didn't realize it, I'm happy to pay what I owe."/shrug.Is it ethically wrong?  Depends on your ethics I guess.I make neough playing that I bother to report it.  If I made 5 grand a year the thought wouldn't even cross my mind.

Point taken, Smash. I guess I don't disagree. I hope the info was helpful to those interested, though.Nikki

[Jtmaroon84 0]

Remember everyone, Big Brother is watching you! Mwahahahahahah

[koolromeo 0]

smash, dont u declare anything? you make like $40k a year online right?thats alot of unreported income.

[Nikki_N 17]

smash, dont u declare anything?  you make like $40k a year online right?thats alot of unreported income.

Here is a quote from one of Smash's earlier posts:"I make neough playing that I bother to report it. If I made 5 grand a year the thought wouldn't even cross my mind."Nikki

[jeremy 0]

So what do you guys consider the cut off point between declaring or just pretending you dont know if you get auditted? I"m thinking maybe 10k?

[hoser_71 0]

I'm a tax preparer so I could clear up a couple of things.Gambling income is still income, regardless of the size of the win. The IRS requires you to report all income. Even if you didn't get a W-2G or a 1099G you are required to report it. Most people choose not to. Even if the gambling is illegal you still have to report it. The IRS cannot turn you in to the authorities for illegal gambling. If you're in the business of gambling and it's your main profession, you can file as a self employed professional gambler and write off expenses. Definately talk to a tax professional first before taking this route. When claiming gambling income you have to report your net winnings for the year on the first page of your 1040. You then claim your net losses for the year as an itemized deduction on the Schedule A. This sucks because the winnings could take you out of contention for certain deductions and credits. Most audits happen because of three things:1. You were dumb and didn't declare something on your return that's easily trackable by the IRS (ex: W-2 and 1099 income, Child Care Expenses, etc.). The IRS has taken to writing letters and asking for proof of specific things instead of a full blown audit.2. A mistake was made. You missed a form, or wrote the wrong number in, or the IRS lost a page. This can trigger the IRS to look a little closer at your return. Once again the IRS has taken to writing letters and asking for proof of specific things instead of a full blown audit.3. Someone turns you in. This accounts for a majority of audits. Usually it's a scorned ex. I've seen a lot of people get audited because an ex wife is trying to get money for child-support. This also falls under gambling. Most audits for gambling winnings occur because someone turned them in, or a bank turned you in because of suspicious activity in your account. I personally haven't seen anyone get audited for hiding gambling winnings, but I've seen people audited for suspicious activity in a bank account. On average I would guess that about 1 in 60 a year will get a letter asking for additional information, and a full blown audit is rare.

[NormanHaupt 0]

ty for posting, hoser.Lesson of the day: If you gamble and make a lot of money in poker, don't piss off your ex wife.

[NYIsles 0]

don't censored off your ex wife.Ummm... isn't that how she became your ex-wife in the first place?

[The Ace of Jades 0]

Heres something fun to consider that we've been talking about in my bussiness class.Bush wants to kill the income tax and in its place put a regulated sales tax on everything. Something like another 15%.So while that'll suck the big one for most of us if it happens, you won't have to worry about gambling revenue.

[jeremy 0]

Heres something fun to consider that we've been talking about in my bussiness class.Bush wants to kill the income tax and in its place put a regulated sales tax on everything. Something like another 15%.So while that'll suck the big one for most of us if it happens, you won't have to worry about gambling revenue.

I would actually like that a lot better. I shouldn't get taxed on money if I haven't decided to buy anything with it yet.

[MikeThk 0]

I hadn't heard of that plan, but it's obviously just another tax-dodge for the rich. It means that people who accumulate more money than they spend (the people getting richer) pay less tax while the people who spend nearly everything they make (most of us) pay more tax. I know Americans love to be duped, but come on.

[GamblinLeaf 0]

I hadn't heard of that plan, but it's obviously just another tax-dodge for the rich. It means that people who accumulate more money than they spend (the people getting richer) pay less tax while the people who spend nearly everything they make (most of us) pay more tax. I know Americans love to be duped, but come on.

Haha, amazing how stereotyping and demagoguery works its way into people's minds. The fact is that the "people who spend everything they make" can't touch the amount of spending done by "the rich". Let's say someone who makes $20k a year spends every penny at a 15% tax rate. That works out to $3k paid in taxes. If just ONE "rich guy" spends $100k on a handful of cars, or a modest boat, he'll pay $15k in tax in this scenario. Heck, Daniel N. spends that much on "italian" leather out of the back of a car! :wink: And what about the hyper-rich trust fund types? Did you know that people like Paris Hilton don't pay a dime in taxes on trust fund protected inheritence money? But you can bet your next buy-in they spend MILLIONS of dollars a year. And just in case anyone reading this is interested in truth, here's another factoid: The U.S. economy has an $11 TRILLION dollar GDP. 70% of that (or $7.7 TRILLION for the math impaired) is consumer spending. The only way that happens is if "the rich" are spending like crazy.Liberals have managed to successfully demonize "the rich" as greedy, baby-eating trolls. In reality, our economy doesn't exist without them.

[allinbluff35 0]

Liberals have managed to successfully demonize "the rich" as greedy, baby-eating trolls. In reality, our economy doesn't exist without them.THINK ABOUT THE BABIES PEOPLE!!!

[StonedViper 0]

The bible says that if you don't pay your taxes your worst then a wine drinking poker player and thou shalt burn in the pits of HELLLLL...LoLJesus saves and pays taxes on his interest.

[KashousKlay 0]

Hey just another question. Say you cash out your winnings by check through the mail. Then you just cash the check and take the cash. Does the bank have to report cashed checks to the IRS above a certain amount?? Just curious. Thanks for the help.

[GamblinLeaf 0]

Does the bank have to report cashed checks to the IRS above a certain amount?? Just curious. Thanks for the help.

Any cash transaction in the U.S. of $10k or more is reported to Uncle Sam by the bank. Less than $10k the bank keeps records of it but is not required to report it. In the post-9/11, anti-terror-money-laundering world that we live in, these records are highly accurate and, generally, available to the Treasury Department (IRS, Secret Service, etc.) upon request.

[scottrude 0]

You may deduct gambling losses only if you itemize deductions. Claim your gambling losses as a miscellaneous deduction on Form 1040, Schedule A (PDF), line 27. However, the amount of losses you deduct may not be more than the amount of gambling income you have reported on your return. It is important to keep an accurate diary or similar record of your gambling winnings and losses. To deduct your losses, you must be able to provide receipts, tickets, statements or other records that show the amount of both your winnings and losses. Refer to Publication 529, Miscellaneous Deductions, for more information.

[ggriffin 0]

you can deduct your winnings only up to your winnings, and you are wrong, fraud does not have to have intent. in auditing there is constructive fraud where you can be so negligent that it is considered fraud. and knowing they irs they are probably reading this forum and taking everyones names down and checking there records. not really, well maybe.....