Tax Question

HarryCaray · Dec 29, 2014

Let's say, theoretically, you won a lot of money offshore. Not like a one time big score, but consistently over time you were pulling checks and depositing them.

At what point would this get noticed? At what point would you be best served to declare it as some kind of self-employment income (freelance web work or something) and pay taxes on it?

Need some help here, I know this is a sensitive subject to discuss out in the open so if someone that knows what they're talking about can PM me or something that would be awesome. :103631605

PatsFan1283 · Dec 29, 2014

It isnt really about how much you've won. It is about how prudent you are with getting the checks.

All you need to do is cash checks in the 3-9k range for a little while and you will be fine. Then obviously your PP for 5D plan works as well.

PP doesn't issue anything tax related unless you have over 200 transactions and 20k in transactions a year.

PatsFan1283 · Dec 29, 2014

It depends who you are as well. If you've got income and are paying taxes it is a little easier than if all you do is play poker and deposit random checks all the time.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
Then obviously your PP for 5D plan works as well.

PP doesn't issue anything tax related unless you have over 200 transactions and 20k in transactions a year.

I'll be OK in 2014 but the current PP plan won't work for me in 2015 on either count. That's why I'm trying to figure out something new for 2015.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
It depends who you are as well. If you've got income and are paying taxes it is a little easier than if all you do is play poker and deposit random checks all the time.

True to some extent, but remember I plan for these checks to go into a different account. Will that make it shadier?

PatsFan1283 · Dec 29, 2014

Depends on a lot of factors. Some of it really just comes down to risk tolerance but 1 check a month at 3-9k likely isn't going to bring any heat but there is no guarantee.

Also you don't have to get all 2015 profits in 2014 as well obviously.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
Also you don't have to get all 2015 profits in 2014 as well obviously.

Don't follow what you mean here.

PatsFan1283 · Dec 29, 2014

HarryCaray said:
True to some extent, but remember I plan for these checks to go into a different account. Will that make it shadier?

You could get a safety deposit box and just put some of the $ in there after you cash the checks.

PatsFan1283 · Dec 29, 2014

HarryCaray said:
Don't follow what you mean here.

I meant all 2015 profits in 2015, obviously some of those checks you can push into 2016, etc

Then obviously it doesn't have to be an all or nothing approach. You can report 10-30% of what you've made

Just 1 of those things you really gotta see how it unfolds, if you endup surpassing your expectations and it is a big # then you probably wanna report a little of it.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
Depends on a lot of factors. Some of it really just comes down to risk tolerance but 1 check a month at 3-9k likely isn't going to bring any heat but there is no guarantee.

Also you don't have to get all 2015 profits in 2014 as well obviously.

So you really think I can open a bank account, and deposit a 9k check each month, totaling $108,000 at the end of the year in that account...and never have to answer any questions about it to the IRS?

PatsFan1283 · Dec 29, 2014

HarryCaray said:
So you really think I can open a bank account, and deposit a 9k check each month, totaling $108,000 at the end of the year in that account...and never have to answer any questions about it to the IRS?

I doubt it if that is really what you plan on doing. That is the furthest extreme.

You will need to get a little more creative than that....Some in PP, some in bank account, some in safety deposit, take some in 2016, etc....Multifaceted approach

If it is 108k a year then you probably want to declare some portion of it though. Obviously don't be wreckless but I understand you want some understanding of what is and isn't reckless.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
I doubt it if that is really what you plan on doing. That is the furthest extreme.

You will need to get a little more creative than that....Some in PP, some in bank account, some in safety deposit, take some in 2016, etc....Multifaceted approach

If it is 108k a year then you probably want to declare some portion of it though

Yeah that's a little hyperbole there, if I thought I could make 108k net playing poker in 2015 I would be going down a different path all together (which would start with moving out of the US).

I have done some projections based on current win rate coupled with the volume I plan to put in, and banking 25k in 2015 is a very attainable goal.

So we'd be talking about like 2k per month deposited into a separate account.

Just not sure what I should do from a tax point of view, if anything.

Reading the below link has me thinking I should keep a log of each and every session...report the sum of my winning sessions as gambling income, and take an itemized deduction on the sum of my losing sessions (not to exceed the amount I claimed as income). Problem being (aside from the fact I would have to pay taxes on it, so 25k would become like 15k or whatever) is that it would hugely inflate my AGI. For example even if I net 25k for the year, that would probably be 100k sum total from winning sessions and 75k sum total from losing sessions (or whatever). So my AGI would now be my current real-job salary + 100k. Not sure of the implications that would have as far as bumping me into another tax bracket.

http://forumserver.twoplustwo.com/5...ght-you-ppa/u-s-income-taxes-re-poker-740589/

I'm not even 100% sure I'm understanding it all correctly, but I think what I said above is correct with regards to AGI.

PatsFan1283 · Dec 29, 2014

You can't use PP and transfer it in slowly from there though? Doesn't seem like you would be rubbing against the threshold.

Everything I said should be enough to avoid any scrutiny on something like 25 but peace of mind is worth a lot.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
You can't use PP and transfer it in slowly from there though? Doesn't seem like you would be rubbing against the threshold.

Everything I said should be enough to avoid any scrutiny on something like 25 but peace of mind is worth a lot.

Several things wrong with staying on the pp route:

Someday 5dimes will cut me off from p2p transfers. They're already putting my transfers through management review.

Someday ppal will close my account for suspicious activity.

Even if not I am afraid of bumping into a bracket where ppal issues me tax forms.

I plan on doing this on a bigger scale in 2015 than I do currently, and I firmly believe I have to get another process in place.

PatsFan1283 · Dec 29, 2014

oh I didn't know 5D was that strict with the transfers.

PP is usually quick with the trigger when it is a bunch of transactions of the same amount but more "lump sum" type transactions they don't seem to have a problem with. Just moreso when they think you are running some type of gambling pool.

Just curious why does it all have to go into 1 acct? If that can't be answered its fine.

HarryCaray · Dec 29, 2014

PatsFan1283 said:
oh I didn't know 5D was that strict with the transfers.

PP is usually quick with the trigger when it is a bunch of transactions of the same amount but more "lump sum" type transactions they don't seem to have a problem with. Just moreso when they think you are running some type of gambling pool.

Just curious why does it all have to go into 1 acct? If that can't be answered its fine.

Well doing the pp thing, it is a bunch of transactions of roughly the same amount. It wouldn't take a genius for them to figure it out.

PLUS it is pretty easy, but I can't just liquidate whenever I want. I have to whore myself out to get it transferred out.

And I don't like posting about that all the time, or doing transfers for dozens of people I have never met. What if one of them turns out to be a federal agent or some shit someday? I know that's paranoia, but you get the point.

Reason I want in in a separate account is right now it just gets mixed in with the rest of my money. I end up spending more, or putting it in my "Real" savings. Then I feel bad if I need to tap into my "real" savings to reload.

This is a long-term goal to build a large poker bankroll over the next 5 years. Having it in an account that I use for my daily spending just makes it kinda hard to gain traction on that specific goal. If that makes any sense.

bigbet1234 · Dec 29, 2014

I'd just pay your taxes. I was audited once, and DO NOT want to go through that

CHOPTALK · Dec 29, 2014

Never heard the pp tax thing before.

I have a merchant pp account with a business I'm in. Also
I use to sell a lot on eBay and did well over 20k 2 or 3 times and never got a form for taxes.

also when hc does all these p2p transactions they use use the friends and family gift tab instead of the goods and services tab which has different tax implications

PatsFan1283 · Dec 29, 2014

CHOPTALK said:
Never heard the pp tax thing before.
I use to sell a lot on eBay and did well over 20k 2 or 3 times and never got a form for taxes.

also when hc does all these p2p transactions they use use the friends and family gift tab instead of the goods and services tab which has different tax implications

Don't quote me on this but I believe it is pretty recent.

HarryCaray · Dec 29, 2014

CHOPTALK said:
Never heard the pp tax thing before.

I have a merchant pp account with a business I'm in. Also
I use to sell a lot on eBay and did well over 20k 2 or 3 times and never got a form for taxes.

also when hc does all these p2p transactions they use use the friends and family gift tab instead of the goods and services tab which has different tax implications

They wouldn't count, unless ppal caught on.

Are personal payments that I receive counted in the total that will be reported to the IRS?
No. Personal payments that are not payments for the sale of goods or services will not be counted when determining if the IRS thresholds have been reached and will not be included on your Form 1099-K if you exceed the thresholds. However, all payments received for the sale of goods or services will be used to calculate the gross payment volume to be reported. ****** monitors accounts to ensure that personal payments are not being used for sales of goods and services.