Payable Taxes For Money Won On Stars

[rdtedm 0]

Hey all -I'm getting mixed opinions on this topic and wanted to generate a discussion on these forums.Recently I cashed a sizeable sum at the FT in the sunday million. I knew through the whole thing that taxes are going to be high on these winnings when I claimed, so it kinda put a damper on my parade.Anyways, after talking with stars, they are not a US-based company and do not report any payouts to players to the IRS. Since they are not a US-based company, it is technically "illegal" to gamble online at stars if you are a US citizen, but of course, nothing has really happened to this point regarding players playing on stars.My question is this:For those of you who have money online in the range of $10,000-$20,000, are you claiming your winnings on your 1040's? many have told me that claiming online winnings is like hanging yourself, since the legality of online poker is in debate. Any bank account deposits under your name for $10,000+ automatically flags you, and if the IRS chooses to audit you, can use this information.Is it possible to cash out various ways, using small amounts and intervals of time. Say, $600/month from ePassporte to your bank, get a $1000-$2000 check in the mail every few weeks, cash the check, and make sure you're not making huge deposits in your bank?I am very curious to see how people with large online bankrolls/winnings go about this process. Please post if you have any relevant experience/advice.

[quadaces 0]

This topic has been brought up before so you may want to search and find other answers as well. The IRS does not care how you received your money! All they want is their cut of it. If you wrote that your job is an assasin and killed many people to get said money, they will not report you as long as you pay the correct amount of taxes for said income. They are all about the bottom line and to them it is about getting paid not locking people up!

[hblask 1]

I'm not an accountant, but I can still pretend I know what I'm talking about....I think if you have any large or regular withdrawals that are not explained, your risk of getting penalized for tax evasion is WAY greater than your risk of getting penalized for playing poker. They'd rather have your money. It's tough for them to catch you based on withdrawals, but if you are caught you are screwed. Gambling winnings just show up under miscellaneous income. The IRS won't bother tracking down which particular gambling you where engaged in. (local casino, slots, lottery, vegas, online...)You can do an EV calculation by measuring the cost of the taxes vs the chance of getting caught vs the penalty for getting caught vs the cost/benefit of being someone's ***** in federal prison.

[iowahawk09 0]

This topic has been brought up before so you may want to search and find other answers as well. The IRS does not care how you received your money! All they want is their cut of it. If you wrote that your job is an assasin and killed many people to get said money, they will not report you as long as you pay the correct amount of taxes for said income. They are all about the bottom line and to them it is about getting paid not locking people up!

LMAO...I am kinda curious too how this works

[HubDub04 0]

If you make various deposits under 10k in order to "get around" IRS paperwork or flags, then it is a felony. It is a violation of the Anti-Structuring Bank Deposits Law established to stop drug dealers and money launderers from operating their mainly cash businesses. The US gov. has really no right to do this, but they do because they are the US government and obv are corrupt on many levels. Just get multiple checks from stars, like in 3k amounts for about 2 months, cash the checks, deposit them all as cash and have them fill out the form for deposits over 10k. Say you sold some personal items privately and thats how u have the cash. They will never be able to prove otherwise. Thats what some acquaintances of myself did with their big online cashes.

[moneymanbc 0]

If you make various deposits under 10k in order to "get around" IRS paperwork or flags, then it is a felony. It is a violation of the Anti-Structuring Bank Deposits Law established to stop drug dealers and money launderers from operating their mainly cash businesses. The US gov. has really no right to do this, but they do because they are the US government and obv are corrupt on many levels. Just get multiple checks from stars, like in 3k amounts for about 2 months, cash the checks, deposit them all as cash and have them fill out the form for deposits over 10k. Say you sold some personal items privately and thats how u have the cash. They will never be able to prove otherwise. Thats what some acquaintances of myself did with their big online cashes.

Won't the name "Poker Stars" on the check be a giveaway, or does their name not appear on the checks?

[delphi12 0]

If you make various deposits under 10k in order to "get around" IRS paperwork or flags, then it is a felony. It is a violation of the Anti-Structuring Bank Deposits Law established to stop drug dealers and money launderers from operating their mainly cash businesses. The US gov. has really no right to do this, but they do because they are the US government and obv are corrupt on many levels. Just get multiple checks from stars, like in 3k amounts for about 2 months, cash the checks, deposit them all as cash and have them fill out the form for deposits over 10k. Say you sold some personal items privately and thats how u have the cash. They will never be able to prove otherwise. Thats what some acquaintances of myself did with their big online cashes.

People should once again understand that the "paperwork" that a bank will file for amounts over $10k do not go to the IRS! They go to a completely different department in the Treasury and our government does not share information easily. What you should understand though is another form that I've spoken about on this site ad naseum that is more disconcerning. It is the SAR (Suspicious Activity Report). The CTR (Cash Transaction Report) is a report that the bank will notify you when they fill out. They need some info from you regarding the transaction, so they will ask it. However, the SAR report is something that will be filed on your behalf without your knowledge! Banks (at least the one I used to work at) will basically file one for almost every customer, regardless, since the government has cracked down on banks that were not doing enough to curb money laundering. Your bank knows your income and knows your spending. If you direct deposits every two weeks for $2k, then it is obvious you have a regular job. If you then are also making cash deposits of $1k every week, without withdrawals (meaning its coming from online or something else), then the bank will file an SAR - guaranteed. Now, the good news is that with every bank in the nation basically sending in millions of these/day, there is a ridiculous backlog of them. The problem is that they can also be sent electronically which means some of us might have a file with quite a few of these sitting there and eventually they will be read ..

[ROGUE06 0]

Won't the name "Poker Stars" on the check be a giveaway, or does their name not appear on the checks?

No poker site's name is ever on the checks they send you. It's always a random bank from some random exotic location.

[shrimp4789 0]

anyone know how this law differs in canada?

[fatman 1]

Just cash the checks and put the money under your mattress.

[DCJ001 0]

No matter how smart someone thinks they are, to get around paying taxes, the IRS has smarter people working for them anticipating what people do to get away with not paying taxes. I'd rather do the right thing, report the numbers accurately, and have a clear conscience, than try to save a few bucks, get caught, make up a lie or two to try to get away with it, get caught, and have to pay the taxes anyway, with penalties, plus time in prison.And as a previous poster made reference to, the IRS prints in their information that they want all income, legal or illegal, reported.Hopefully, JC PartyPSux is keeping at least a third ($180k or so) of his winnings protected for next year's taxes.

[SonnyBarger 0]

A number of faulty assumptions/misinformation in your post.1. There is no federal law in the US against gambling online. The UIGEA restricts US-based financial institutions ability to transfer money to internet gambling sites, but does not say a US citizen can't play. The only 2 US state that I'm aware of that make internet gambling illegal are Washington and Nevada.2. Gambling income is classified as *ordinary income* for tax purposes, just like wages, salries, tips (aka W2 income) and Independent contractor income (aka 1099 income). The reason you get nailed on gambling income is that IRS pub. 529 expressly forbids reporting the net of wins - losses as income. So, you must have adequate records, and you reprort all winning sessions as income on Form 1040 and all losing sessions as an itemized deduction on schedule A. If you do not normally itemize this overstates your income by about $6,000 (the amount of the standard deduction), and even if you do already itemize, it still drives you into a higher tax bracket and raises the specter of the truly evil Alternative Minimom Tax. If you live in a state that has a state income tax, you may be screwed. MA and RI, for example, do not allow you to deduct losses, so if you won, say $50k based upon $100K of winning sessions minus $50k of losing sessions, you would pay state tax on $100k of gambling income.3. Another misconception is the $10,000 deposit. In reality, banks are required to monitor non-payroll activity once it exceeds $5,000 in a caledar year. The reality is that whether said activity gets reported or not is a function of how diligent your bank is. However, if you bring the money over in one lump sum and don't report it, unless we're talking an amount in excess of $200,000, the only thing that will happen is you'll get a bill for the unpaid amount plus penalty and interest. If you bring it over in little bits and pieces, don't report it and get caught, that's called "structuring" and you will go to jail.4. The IRS' job is to collect money, not to serve as an arm of other law enforcement agencies. There's a big hubbub right now because the IRS will not share info with the INS regarding illegal aliens' tax returns. Supposedly (I've never know an actual case) if you report income on your return and say the source is "drug dealing" the IRS will not report you to the DEA. They have specific rules in place that guarantee that they do not rat people out, simply because they want to collect money and being rats would get in the way of that.The tax code sucks, but that's life. I'd suggest you hire an accountant. from your post it sounds like your big score was this year, so the good news is you have a year to figure it out.

[ShaneO19 0]

It is definitely frustrating that there isn't some sort of cut and dry policy regarding these "gambling" winnings. I have read a ton of posts on poker forums regarding this and every single person seems to have a different opinion on what you should do. I actually feel that this deters me from winning more than I do because of the feeling of uncertainty.

[DCJ001 0]

It is definitely frustrating that there isn't some sort of cut and dry policy regarding these "gambling" winnings. I have read a ton of posts on poker forums regarding this and every single person seems to have a different opinion on what you should do. I actually feel that this deters me from winning more than I do because of the feeling of uncertainty.

It is "cut and dry." But a lot of people are wrong which is why you see a lot of differing opinions.

[RichieValenz 0]

PocketFives Tax Q&Aand here's a link to a thread on 2+2 with a ton of info:http://forumserver.twoplustwo.com/showflat...c=1#Post4712394

[Marchione 0]

two american players i know have opened bank acc's in Australia and Canada.then winning are cleared thru a bank card back in the USA, im not telling anyone to do this - just saying i know people who have done it.

[DCJ001 0]

two american players i know have opened bank acc's in Australia and Canada.then winning are cleared thru a bank card back in the USA, im not telling anyone to do this - just saying i know people who have done it.

Adding charges for money laundering to tax evasion ought to make things interesting for you, I mean them.

[chrozzo 19]

since when is it illegal to play online poker in america?

[scram 1]

There are plenty of ways to evade taxes. Like, a ton.Offshore accounts, filtering, laundering... It doesn't take a genius to figure it out.Get caught doing it?Even if you're a first time offender, you will most likely to prison time.They will forfeit a substantial amount of your personal property- things like televisions, cars, real estate (including your home), jewelry- basically anything of value. Treasury Department law enforcement agents will handle that.Your lawyers will cost 10-15K to handle a simple federal tax evasion case (assuming you just plea and don't take it to trial.)If you take it to trial, figure $25K-$30K for a decent attorney. You will probably get minimum bail. Figure a 10K bond might cost you $1500-$2000. If you're lucky, you might get a signature bond. If you plea, your sentence will be lighter, If you go to trial, you will lose.You, as a newly minted tax evader or money launderer, will go to a Federal Prison Camp where you will be housed with other white collar offenders and minimum risk inmates. Depending on how much money you laundered or the volume of taxes you evaded, your guideline range will most likely be in the 12-36 month region. Don't worry, though. Although you will be scared at first, you will eventually settle in and get over it.The pop-culture myth of "Federal Prison" being "Pound-Me-In-The-*** Prison" for non-violent offenders is just that; a myth. You're not going to get raped. You will go in, keep your head down and do your time.Once you have 4-6 months left on your sentence, you will be able to apply for halfway house.After 85% of your sentence is served (and assuming no major infractions), you will be eligible for release (to probation, for likely 2-5 more years)Then, you can start on the road of rebuilding your life.So, as you can see, you really have nothing to worry about. All you risk is $15K-$30K in attorney fees and 1-3 years of your life, plus the years it takes to rebuild..(facts tempered with sarcasm)

[finztotheleft 0]

If you make various deposits under 10k in order to "get around" IRS paperwork or flags, then it is a felony. It is a violation of the Anti-Structuring Bank Deposits Law established to stop drug dealers and money launderers from operating their mainly cash businesses. The US gov. has really no right to do this, but they do because they are the US government and obv are corrupt on many levels. Just get multiple checks from stars, like in 3k amounts for about 2 months, cash the checks, deposit them all as cash and have them fill out the form for deposits over 10k. Say you sold some personal items privately and thats how u have the cash. They will never be able to prove otherwise. Thats what some acquaintances of myself did with their big online cashes.

Someone is supposed to pay sales tax on those "sales"

[Highlow16 0]

Pay your taxes. If your audited your screwed. It doesnt matter if you play poker, sling crack, or eat hot dogs for a living.... you have to pay

[Whatever 1]

Not reporting income = possible jail timeDon't screw around with the IRS when it comes to income.Good luck.

[TR1N1TY 0]

LOL @ reporting poker winnings to the IRSyea right...gimme a break