Taxes With A Big Tourney Win

[pokerloser 0]

The casino fills out a W-2G, regardless of how you collect your winnings. Cash, Chips, Check, Bubble gum. It does not matter. You get a W-2G, PERIOD. You get a copy, they send a copy to the IRS. And, you pay your taxes. Of course you can itemize and write off everything you can prove, Entry fees, loses etc. to help offset that, but if you win in a casino, you get a W-2G. No way around it.I hope that helps.

[mhoward29 0]

The casino fills out a W-2G, regardless of how you collect your winnings. Cash, Chips, Check, Bubble gum. It does not matter. You get a W-2G, PERIOD. You get a copy, they send a copy to the IRS. And, you pay your taxes. Of course you can itemize and write off everything you can prove, Entry fees, loses etc. to help offset that, but if you win in a casino, you get a W-2G. No way around it.I hope that helps.

Thank you for the best answer Ive heard. So even if you take it in chips the IRS gets word of it.

[Threester 0]

On a slightly unrelated note. Or maybe a related one... whatever...I heard that Joe 'The Sugar' Hachem had to pay U.S. taxes on his winnings when he won the WSOP main event even though he's an Australian citizen. Anyone know whether thats true or not?Seems strange that he would have to pay U.S. taxes instead of Australian ones.

[mhoward29 0]

On a slightly unrelated note. Or maybe a related one... whatever...I heard that Joe 'The Sugar' Hachem had to pay U.S. taxes on his winnings when he won the WSOP main event even though he's an Australian citizen. Anyone know whether thats true or not?Seems strange that he would have to pay U.S. taxes instead of Australian ones.

Joe hired the best tax lawyers around and went to court over it. He won and only had to pay a small amount of tax. If you dont believe me listen to "the circuit" on cardplayer.com when they interview him.

[Balloon guy 158]

And for the record there is nothing more American than trying to figure out ways to pay less taxes.It's what seperates us from the communist, that and stores with food and freedom.I did like the UK guy bragging about not having to pay taxes on gambling winnings. What's your marginal rate? 50%, shoot they already bleed you like a pig, so they let you keep a peanut and you think you can brag? Here's a newsflash, people in America that don't make more than about $23K a year pay almost NO income taxes.

[schnoodle_C 0]

Joe hired the best tax lawyers around and went to court over it. He won and only had to pay a small amount of tax.If you dont believe me listen to "the circuit" on cardplayer.com when they interview him.

Joe challenged paying taxes in Australia not the US. He had to pay in the US and he would have had to pay in Australia if he was a "professional" at the time.What is true is that while the Casino will file a W-2G you can request that they withhold less if you feel that you have reason to believe that you will have to pay less in the end when you do your taxes than what they want to withhold. However, note that if your wrong you will have to pay interest penelties even though they aren't that bad.

[pokerplayer24 0]

And there's the problem. You enter a tournament for $9,000. You are the first money finisher and you win $10,000. So then you get a check for $10,000. NOT! You get a check for, say, $7,500 (or less), because "You just won $10,000" and the government wants it's portion. See a problem yet? Furthermore, if you're one of those people that do not itemize deductions, you will never, ever see that other $2,500, no matter how much or how little money you made that year.Additionally, (unless they're all professional gamblers) people have already paid (or will pay) income tax on the $9,000 they put into the prize pool. In other words, the prize pool is completely made up of money that has already been taxed. Okay. That's a side issue, but hence the problem with taxing poker winnings.It's not too dissimilar when doing stock-trading (which I have also dabbled in), but at least in that case, you can deduct all of your losses (which I have done), even if you didn't "make" any money. Reporting poker winnings is something that the IRS still does not have a good handle on. You could theoretically have a huge net loss for the year, and could still have to pay a lot of money in taxes. It should not be that way, but it is.

They tax your profit not total winnings. So they would be taxing the 1k

[Balloon guy 158]

Joe challenged paying taxes in Australia not the US. He had to pay in the US and he would have had to pay in Australia if he was a "professional" at the time.What is true is that while the Casino will file a W-2G you can request that they withhold less if you feel that you have reason to believe that you will have to pay less in the end when you do your taxes than what they want to withhold. However, note that if your wrong you will have to pay interest penelties even though they aren't that bad.

Estimated taxes are only charged penalties if more than 7% off the actual tax burden.

[Threester 0]

Thanks for the replies guys. That makes it clearer. As for the 23k US tax limit -> Wow! That is pretty good. In Britain its like 4k or something ridiculously low like that. Damn it! just when we thought we had one over on you yanks