tax advice for whores and middlers

marc · Apr 6, 2005

After consulting a tax attorney and 2 accounting proffessors this is how i was told to report my income. The income should be reported as business income and not gambling income. The benefit is that your income is the net withdrawals minus the net deposits. Whereas gambling income is your wiinings,a nd then you get to deduct your losses againbst those winnings.

The downside is you might get hit with a self employment tax which for me is 13%. Fortunately that tax maxes out at about 88k.

Thats the professional advice I was given. Good luck to all of you, and I hoep no one here gets audited

Fishhead · Apr 6, 2005

Do what you think is best for you and very happy to see that you seeked professional advice.

Personally, I do NOT like to take that route for various reasons.

Prefer to keep a DETAILED diary and report all my winnings on LINE 21, and deduct my losses up to the extent of my winnings.

Best wishes,
-FISH-

nimue77 · Apr 6, 2005

Wow, I would have no clue about my total wins and losses. I only know my total profit/loss.

Fishhead said:
Do what you think is best for you and very happy to see that you seeked professional advice.

Personally, I do NOT like to take that route for various reasons.

Prefer to keep a DETAILED diary and report all my winnings on LINE 21, and deduct my losses up to the extent of my winnings.

Best wishes,
-FISH-

AK · Apr 6, 2005

Im not reporting anything this year amd sure not going to file any taxes.

X-Files · Apr 6, 2005

Move to Canada, eh?

AK · Apr 6, 2005

<HR style="COLOR: #fdde82" SIZE=1> 

Move to Canada, eh?

Sorry but no, Found a Nice Pad In Las Vegas I know Call Home.

X-Files · Apr 6, 2005

AK said:
Sorry but no, Found a Nice Pad In Las Vegas I know Call Home.

I'd love to live in Vegas.

But for those Yanks worried about taxes, my advice is
to seek asylum up North...no taxes on gambling winnings.

Either that or start another Revolution over tea.

AK · Apr 6, 2005

Either that or start another Revolution over tea.

X-File forgot to ask you, you employeed with FBI?

I used to be with a subdivision for the FBI for over a year should have laid down the speed.

X-Files · Apr 6, 2005

AK said:
X-File forgot to ask you, you employeed with FBI?

I used to be with a subdivision for the FBI for over a year should have laid down the speed.

Negative. The XFiles tv series was all about the FBI, aliens
government coverups & abductions.

PanchoSanza · Apr 6, 2005

x files,

gambling income is taxable in Canada in certain cases.

If its essentially your primary source of income, sorry to say its likely taxable.:sad3:

trytrytry · Apr 6, 2005

Fishhead said:
Do what you think is best for you and very happy to see that you seeked professional advice.

Personally, I do NOT like to take that route for various reasons.

Prefer to keep a DETAILED diary and report all my winnings on LINE 21, and deduct my losses up to the extent of my winnings.

Best wishes,
-FISH-

fish

even if you dont bring the money into a USA bank account or withdraw it in some manner? That would be thousands and thousands of individual wagers to track.

X-Files · Apr 6, 2005

http://www.studymanuals.com/htmlsamples/Course5_Excerpt_4-27-03.htm

Pancho Sanza said:
x files,

gambling income is taxable in Canada in certain cases.

If its essentially your primary source of income, sorry to say its likely taxable.

All i can say is that several years ago i asked my tax advisor if gambling
winnings were taxable & must be reported & she said they were not. No
exceptions were made.

The above url states:

"9. Canadians enjoy exemption of lottery winnings and other gambling income"

But if the law has changed or there are exceptions to the rule above,
i am not aware of them.

Fishhead · Apr 6, 2005

trytrytry said:
fish

even if you dont bring the money into a USA bank account or withdraw it in some manner? That would be thousands and thousands of individual wagers to track.

Precisely!

Not that difficult to ring up over $1,000,000 in winnings, even for a semi-highroller.

-F-

marc · Apr 6, 2005

Fish,

What do you do about winnings that you havn't withdrawn. How do you account for the fact that you may not collect.

Also how do you account for bonus money?

Fishhead · Apr 6, 2005

marc said:
Fish,

What do you do about winnings that you havn't withdrawn. How do you account for the fact that you may not collect.

Also how do you account for bonus money?

Marc-- It is all the BOTTOM LINE........get a bonus for $300........you just won $300 and note it.

If a book stiffs you $2,000, thats a $2,000 wager LOST.

-F-

Redneckman · Apr 6, 2005

Fish, do you offset your losses on line 21 or do you take an itemized deduction for the losses? I'm guessing the latter?

Fishhead · Apr 6, 2005

Redneckman said:
Fish, do you offset your losses on line 21 or do you take an itemized deduction for the losses? I'm guessing the latter?

Itemized deduction, yes.

-F-

Redneckman · Apr 6, 2005

You're right, that's technically correct, I just hope it isn't an audit flag to have such a large itemized deduction total. It shouldn't be, but never know quite how the IRS operates.

RPM · Apr 6, 2005

marc said:
After consulting a tax attorney and 2 accounting proffessors this is how i was told to report my income. The income should be reported as business income and not gambling income. The benefit is that your income is the net withdrawals minus the net deposits. Whereas gambling income is your wiinings,a nd then you get to deduct your losses againbst those winnings.

The downside is you might get hit with a self employment tax which for me is 13%. Fortunately that tax maxes out at about 88k.

Thats the professional advice I was given. Good luck to all of you, and I hoep no one here gets audited

marc,

filing like that will require you to pay your own social security tax if im not mistaken. its hard to believe that is the better way to go....