vpFREE2 Forums

1200 W@G

#1

Curtis Rich wrote
I have a question regarding dishonesty....
If I hit a $1,000 RF during a 'session' but I end up losing
all of the RF $1,000 PLUS some of my own money, is it
dishonest to not report the $1,000 jackpot? If I am supposed
to report the $1,000 gambling winnings and deduct the $1,000
(maximum allowed) gambling losses, why can't I just report
nothing? The net tax affect (in my case) is the same - zero.
Is that dishonest? I don't think so. But, if you do, please
explain to me why it is dishonest.

  I wouldn't say dishonest, but it is illegal. Tax law does't give you an option to net losses against winnings and not report. Also, review previous posts in this thread and you will see that deducting the losses is only an option for people who itemize, and in some instances, itemized deductions are disallowed (e.g., people subject to alternative minimum tax). I don't want to discuss the "fairness" of this, just the legal requirements under the Tax Code.

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#2

<<If I hit a $1,000 RF during a 'session' but I end up losing all of the RF
$1,000 PLUS some of my own money, is it dishonest to not report the $1,000
jackpot? If I am supposed to report the $1,000 gambling winnings and deduct
the $1,000 (maximum allowed) gambling losses, why can't I just report
nothing? The net tax affect (in my case) is the same - zero.
Is that dishonest? I don't think so. But, if you do, please explain to me
why it is dishonest.

  I wouldn't say dishonest, but it is illegal.>>

The problem is that IRS has two conflicting instructions for line 21: report
total of W-2Gs and report total of winning sessins. For high-limit players,
the total of winning sessions is far less than the W-2G total. I have
reported the session total each year with a note that it includes all the
W-2Gs (and write down that amount) and have not yet had an issue.

Cogno

#3

question from someone who hasn't reported gambling wins or losses on
his taxes: What, according to the IRS is a 'session'? Would it be
'dishonest' to engineer my sessions to reduce my 'total of winning
sessions'?

···

On 11/21/05, Cogno Scienti <cognoscienti@gmail.com> wrote:

The problem is that IRS has two conflicting instructions for line 21: report
total of W-2Gs and report total of winning sessins. For high-limit players,
the total of winning sessions is far less than the W-2G total. I have
reported the session total each year with a note that it includes all the
W-2Gs (and write down that amount) and have not yet had an issue.

Cogno

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#4

Another option could be to report the entire play before the W2G as a
session, the single play for the W2G as a second session, and the play
after the W2G as a third session. The first and third sessions might
be positive or negative, and can be legally and honestly reported as
such.

The illegal part would be to not report positive sessions that did not
generate a W2G. It would be especially sneaky to only play games where
the biggest possible win would be $1199 or less and to not report
anything. Some places advertise "no tax" $1199 jackpots which are
incentives for such behaviors. On the other hand you could argue that
playing a "no W2G" style makes tax paperwork easier by avoiding
exaclty the situation that was mentioned.

JBQ

···

On 11/21/05, Cogno Scienti <cognoscienti@gmail.com> wrote:

The problem is that IRS has two conflicting instructions for line 21: report
total of W-2Gs and report total of winning sessins. For high-limit players,
the total of winning sessions is far less than the W-2G total. I have
reported the session total each year with a note that it includes all the
W-2Gs (and write down that amount) and have not yet had an issue.

#5

It is my understanding that a "session" has never really been defined by the IRS.

.....bl

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--- In vpFREE@yahoogroups.com, LHOOQ <fieldcommand@g...> wrote:

What, according to the IRS is a 'session'?

#6

That's my understanding.

It can't hurt to be reasonable (don't report your entire year as a
session or every single play as a session) and consistent (have a rule
to define your "session").

JBQ

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On 11/21/05, bornloser1537 <bornloser1537@yahoo.com> wrote:

It is my understanding that a "session" has never really been defined by the IRS.

#7

LHOOQ wrote:

question from someone who hasn't reported gambling wins or losses on his
taxes: What, according to the IRS is a 'session'? Would it be
'dishonest' to engineer my sessions to reduce my 'total of winning

vpFREE Poll: For tax record purposes, what do you use as a "session" ?

<http://groups.yahoo.com/group/vpFREE/surveys?id=11927322>

vpFae

#8

<<question from someone who hasn't reported gambling wins or losses on
his taxes: What, according to the IRS is a 'session'? Would it be
'dishonest' to engineer my sessions to reduce my 'total of winning
sessions'?>>

Marissa and I have a long discussion about a "session" in our book "Tax Help for the Frugal Gambler" (available at my Web site below). Here is one short excerpt:

"It's usually to the advantage of a taxpayer to have as long a session as possible in order to have the lowest net total for winning sessions; we discuss the compelling reasons for this later. However, what a person counts as a gambling session, in the absence of clear-cut instructions, has to be based on consistency, reasonableness and practicality, depending on the circumstances in each individual case. One tax expert put it this way: "My advice is to use whatever definition you feel that you could defend in an IRS audit with a straight face and without sweating." >>

There are many more details about "sessions" in the book as well as on many of the complicated issues that come up when figuring out how to report gambling wins and losses. We cover record-keeping, professional vs. recreational status, W2Gs, tournament and drawing wins, comps, live poker play, and information on state tax regulations.

···

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#9

There is a VPFREE poll in which members have stated what they consider to be a session.
Interested parties might want to read that poll (and contribute their opinions, if they have
not already donne so).

.....bl

···

--- In vpFREE@yahoogroups.com, Jean-Baptiste Queru <jbqueru@g...> wrote:

That's my understanding.

It can't hurt to be reasonable (don't report your entire year as a
session or every single play as a session) and consistent (have a rule
to define your "session").

JBQ

On 11/21/05, bornloser1537 <bornloser1537@y...> wrote:
> It is my understanding that a "session" has never really been defined by the IRS.

#10

I think you answered your own question. The Royal is just one hand during your session. If for example you brought $500 with you, lost $200, then hit a royal for $1,000, then lost $500 trying to get another one (pessimistic), your session win is a win of $200.

Cogno Scienti <cognoscienti@gmail.com> wrote: <<If I hit a $1,000 RF during a 'session' but I end up losing all of the RF
$1,000 PLUS some of my own money, is it dishonest to not report the $1,000
jackpot? If I am supposed to report the $1,000 gambling winnings and deduct
the $1,000 (maximum allowed) gambling losses, why can't I just report
nothing? The net tax affect (in my case) is the same - zero.
Is that dishonest? I don't think so. But, if you do, please explain to me
why it is dishonest.

  I wouldn't say dishonest, but it is illegal.>>

The problem is that IRS has two conflicting instructions for line 21: report
total of W-2Gs and report total of winning sessins. For high-limit players,
the total of winning sessions is far less than the W-2G total. I have
reported the session total each year with a note that it includes all the
W-2Gs (and write down that amount) and have not yet had an issue.

Cogno

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