qusetion about tax

[Mists 0]

Hey all, I'm fairly new to the onlnie poker scene, so I have a llittle tax question. (By the way, I did search for what I was looking thruoght hruogh searcch, didn't find it.. rather not thumb through many pages, figured this would be faster/easier ^^)Anyways, I live in the US, and I use Neteller as my withdrawal/deposit system. So I wash opnig somenoe could take me through step by step int his scenario.Say I'm playing a huge tournament, and I fniish high up and win.. 40k+ or more. Starting right fromt he point where I close off the table and have the money ni my account, what happens? Is my win reported tot he IRS? Or, is it taxed when I withdraw with Neteller, and have Neteller send me the check to make the deposit? Sorry about the dumb question guys, but thanks!

[koolromeo 0]

no one knows that you won that money. the irs isn't notified. the money is never taxed unless you declare it. if u never declare it, itwon't be taxed, but if you get audited your screwed. how much of a gambler are u?

[mobius481 0]

to answer your question. It is taxed when you take it out of Netteller. Of course, the IRS isn't notified but it does have to be taxed.

[ajs510 122]

no one knows that you won that money. the irs isn't notified. the money is never taxed unless you declare it. if u never declare it, itwon't be taxed, but if you get audited your screwed. how much of a gambler are u?

There's a subtle difference between gambling at the 5/10 table and gambling with 5-10 years...If you try to deposit a check for $40,000 (or any amount over $5k, I'm pretty sure) into your bank account, the bank is required to fill out and file a form with the IRS declaring the transaction. There's an entire forum devoted to tax stuff over at pocketfives.com, I would suggest reading up on the advice over there rather than listening to people who have no idea what they're talking about. If you leave the $40k in your poker account and don't cash it out (or cash it out very, very slowly), it's a fair bet that you won't be noticed by the IRS, but you're still taking a whole lot of risk for not that much of a savings. Just my .02

[MikeJohnson724 0]

no one knows that you won that money. the irs isn't notified. the money is never taxed unless you declare it. if u never declare it, itwon't be taxed, but if you get audited your screwed. how much of a gambler are u?

HAHAHA. I liked your post.

[allinbluff35 0]

i.r.s. is notified of any transactions to your bank account of $10,000 or more.

[delphi12 0]

i.r.s. is notified of any transactions to your bank account of $10,000 or more.

*SIGH*.. Totally inaccurate..There are two forms that get filed by banks regarding transactions - NONE OF WHICH go to the IRS. The $10k form is called a CTR (cash transaction report) and goes to the Department of the Treasury - they want to know where 10k transactions are going. And most banks will only file this form if the transaction is in the form of CASH - not checks - however wire transfers will often trigger the form.The second form is called a SAR (suspicious activity report). It also goes to the Department of the Treasury - who often will send it on to the FBI and CIA. This form is filled out when a transaction of $5k or more is done on an account that the bank feels is out of the ordinary transaction for this customer. Note that all new accounts have to fill out something called "KNOW YOUR CUSTOMER" - its a way for the bank to get an idea of what kind of transactions you will be doing to make it easier for them to file the SAR's.Note that you will know when a CTR is filled out - you will get a copy. SAR's are filled out without your knowledge.NONE OF THIS PAPERWORK EVER GOES TO THE IRS. They couldn't care less about it. You could be moving money back and forth between your brokerage and bank account and the IRS would think you kept making money - they have better things to worry about. Note that when you get audited, they will probably contact the other departments and find out about the forms that were filed and go from there.I'm speaking as an ex-bank employee, btw.

[mk 11]

Pay your taxes. You're an idiot if you don't.http://www.twoplustwo.com/magazine/issue11...miller1105.html

[allinbluff35 0]

i.r.s. is notified of any transactions to your bank account of $10,000 or more.

*SIGH*.. Totally inaccurate..There are two forms that get filed by banks regarding transactions - NONE OF WHICH go to the IRS. The $10k form is called a CTR (cash transaction report) and goes to the Department of the Treasury - they want to know where 10k transactions are going. And most banks will only file this form if the transaction is in the form of CASH - not checks - however wire transfers will often trigger the form.The second form is called a SAR (suspicious activity report). It also goes to the Department of the Treasury - who often will send it on to the FBI and CIA. This form is filled out when a transaction of $5k or more is done on an account that the bank feels is out of the ordinary transaction for this customer. Note that all new accounts have to fill out something called "KNOW YOUR CUSTOMER" - its a way for the bank to get an idea of what kind of transactions you will be doing to make it easier for them to file the SAR's.Note that you will know when a CTR is filled out - you will get a copy. SAR's are filled out without your knowledge.NONE OF THIS PAPERWORK EVER GOES TO THE IRS. They couldn't care less about it. You could be moving money back and forth between your brokerage and bank account and the IRS would think you kept making money - they have better things to worry about. Note that when you get audited, they will probably contact the other departments and find out about the forms that were filed and go from there.I'm speaking as an ex-bank employee, btw.

note to self, find a new accountant person.

[delphi12 0]

Pay your taxes. You're an idiot if you don't.http://www.twoplustwo.com/magazine/issue11/miller1105.html

That article said nothing of substance. I am not advocating not paying your taxes, but I know from a banking side, the IRS is not informed of anything going on. The only taxes I pay are those from reported by my employer and casino W-2Gs. Then again, the other winnings are miniscule anyway and it would cost the IRS more money to audit me than what I probably owe.

[PAYforUSC 0]

don't worry...don't pay pay tax

[MOMOwheeler 0]

Note that you will know when a CTR is filled out - you will get a copy. SAR's are filled out without your knowledge.

I had 68k wired to my bank account and never got a copy of a CTR.... or anything to indicate they notified anyone for that matter.(and yes, I paid uncle sam his BS 32%)

[leftygolfer 7]

i.r.s. is notified of any transactions to your bank account of $10,000 or more.

*SIGH*.. Totally inaccurate..There are two forms that get filed by banks regarding transactions - NONE OF WHICH go to the IRS. The $10k form is called a CTR (cash transaction report) and goes to the Department of the Treasury - they want to know where 10k transactions are going. And most banks will only file this form if the transaction is in the form of CASH - not checks - however wire transfers will often trigger the form.The second form is called a SAR (suspicious activity report). It also goes to the Department of the Treasury - who often will send it on to the FBI and CIA. This form is filled out when a transaction of $5k or more is done on an account that the bank feels is out of the ordinary transaction for this customer. Note that all new accounts have to fill out something called "KNOW YOUR CUSTOMER" - its a way for the bank to get an idea of what kind of transactions you will be doing to make it easier for them to file the SAR's.Note that you will know when a CTR is filled out - you will get a copy. SAR's are filled out without your knowledge.NONE OF THIS PAPERWORK EVER GOES TO THE IRS. They couldn't care less about it. You could be moving money back and forth between your brokerage and bank account and the IRS would think you kept making money - they have better things to worry about. Note that when you get audited, they will probably contact the other departments and find out about the forms that were filed and go from there.I'm speaking as an ex-bank employee, btw.

Spent 15 years as a commercial lending officer for a couple of banks. ALL banks are required to file a CTR on all cash transactions (deposits and withdrawls) over $10,000 over a 24 hour period. I don't think wires are inluded. Don't get cute and do one for $7k and one for $6k an hour later.

[ThatPkrGuy 0]

if your a big loser online (obv outside of the 40+ K win)...and its time to be honest with yourself...i recommend reviewing and recording how much you lost playing poker as well. Since you can subtract that from your winnings for the year... but it only works to a certain extent.Say you win 10K in a year but lose 8K...you only have to report 2K...So that makes 8k of it deductable...But say you win 10K and lose 12K...you can't deduct 2K from your normal wages for the year.I'm 95% everything works the way i just said it did...but if your cashing 40+ you need to pay taxes and you need to get an accountant to make sure you don't censor anything up.

[DeadStroke 0]

Pay your taxes. You're an idiot if you don't.http://www.twoplustwo.com/magazine/issue11/miller1105.html

That article said nothing of substance. I am not advocating not paying your taxes, but I know from a banking side, the IRS is not informed of anything going on. The only taxes I pay are those from reported by my employer and casino W-2Gs. Then again, the other winnings are miniscule anyway and it would cost the IRS more money to audit me than what I probably owe.

http://www.irs.gov/compliance/enforcement/...=112228,00.htmlThe IRS is a division of the Department of Treasury and the CTR's and SAR's are actually stored within an IRS department. All divisions of the Department of Treasury have access to these reports, how much they use them are anyone's guess.

[Hobbes 1]

if your a big loser online (obv outside of the 40+ K win)...and its time to be honest with yourself...i recommend reviewing and recording how much you lost playing poker as well.  Since you can subtract that from your winnings for the year... but it only works to a certain extent.Say you win 10K in a year but lose 8K...you only have to report 2K...So that makes 8k of it deductable...But say you win 10K and lose 12K...you can't deduct 2K from your normal wages for the year.I'm 95% everything works the way i just said it did...but if your cashing 40+ you need to pay taxes and you need to get an accountant to make sure you don't censor anything up.

If you're a poker professional, you report gross winnings and losses on Schedule C. If you are not, you report gross winnings under other income on your 1040 and gambling losses on Schedule A. You cannot take more losses than winnings. You do not report net winnings.If you receive a W-2G, you should report all of your gambling winnings, even that which does not make it onto the W-2. This is because the IRS assumes that if you received one, you most likely have other gambling winnings that weren't reported. If they don't see other gambling winnings being reported, they will start asking questions.

[_Great_Dane_ 0]

i.r.s. is notified of any transactions to your bank account of $10,000 or more.

*SIGH*.. Totally inaccurate..There are two forms that get filed by banks regarding transactions - NONE OF WHICH go to the IRS. The $10k form is called a CTR (cash transaction report) and goes to the Department of the Treasury - they want to know where 10k transactions are going. And most banks will only file this form if the transaction is in the form of CASH - not checks - however wire transfers will often trigger the form.The second form is called a SAR (suspicious activity report). It also goes to the Department of the Treasury - who often will send it on to the FBI and CIA. This form is filled out when a transaction of $5k or more is done on an account that the bank feels is out of the ordinary transaction for this customer. Note that all new accounts have to fill out something called "KNOW YOUR CUSTOMER" - its a way for the bank to get an idea of what kind of transactions you will be doing to make it easier for them to file the SAR's.Note that you will know when a CTR is filled out - you will get a copy. SAR's are filled out without your knowledge.NONE OF THIS PAPERWORK EVER GOES TO THE IRS. They couldn't care less about it. You could be moving money back and forth between your brokerage and bank account and the IRS would think you kept making money - they have better things to worry about. Note that when you get audited, they will probably contact the other departments and find out about the forms that were filed and go from there.I'm speaking as an ex-bank employee, btw.

Spent 15 years as a commercial lending officer for a couple of banks. ALL banks are required to file a CTR on all cash transactions (deposits and withdrawls) over $10,000 over a 24 hour period. I don't think wires are inluded. Don't get cute and do one for $7k and one for $6k an hour later.

Yeah. You should put a couple of days between the withdrawls.

[Rude Dog 0]

When they come for the audit, offer to play HU for it.

[MikeJohnson724 0]

I say don't pay any taxes at all and any taxes they took out of your paychecks write the IRS a letter and tell them you want it back. I mean, what do you think, the IRS audits EVERYONE?

[teneight 1]

pay your taxes and you wont have a problemteneight

[mk 11]

Audits are not chosen at random. If you continuously have money appearing out of nowhere, you are MUCH more likely to get audited. This is extraordinarily bad not only for your current situation but later down the road, because after you are audited once, the chance of getting audited again is much higher.

[MikeJohnson724 0]

Audits are not chosen at random. If you continuously have money appearing out of nowhere, you are MUCH more likely to get audited. This is extraordinarily bad not only for your current situation but later down the road, because after you are audited once, the chance of getting audited again is much higher.

That is true, BUT No one knows the formula the IRS uses that triggers the audits.