vpFREE2 Forums

Canadians and recovering 30% tax on jackpots

#1

The alternative is to go to one the "accountants" that specialise getting Canadians their
deducted winnings back by charging them an exorbitant fee for the service.

How much do the agencies skim? Anyone used them?

If you have net gambling winnings (after offsetting your total losses against your total winnings), you should include this net amount on line 79, column (d) of the Form 1040NR.

A diary of your losses should be kept for your records.

I went through this process some years ago with a $1 royal (the good
ole 1-100 machines at TI - how I miss those days).

My understanding of the process is that you won't automatically get
back the entire $1200 withheld on a 4K royal unless you have gambling
losses to offset that amount.

In my case I did not have such losses - but I did get back a large
portion of the $1200 - over half.

Can anyone else confirm that this is the case, or do other Canadians
typically get back all the withheld amount without showing equivelent
losses?

(This keeps us from playing certain .25 progressives - once its over
$1200 we'll get dinged 30% so whats the point?)

Agree that getting the ITIN is the trickiest part of the process - if
you need a US notary public, most casinos have them on hand. So bring
your forms down with you next trip to Vegas.

#2

--- In vpFREE@yahoogroups.com, "Royal Flusher" <royalflusher@...>
wrote: My understanding of the process is that you won't automatically
get back the entire $1200 withheld on a 4K royal unless you have
gambling losses to offset that amount.

The way that it works is that you are taxed on your net winnings at the
rate of 30%. So if you broke even on all play except for your 4K
Royal, you wouldn't get back anything. Of course, most people will have
net losses at the time that they hit the Royal. So most people will get
back something. The key thing is to keep accurate records in case you
are audited (unlikely but possible).

Each country is treated differently. You can read all the tax treaties
on the IRS website.

The "accountants" that specialize in helping Canadians recover their
tax charge a fee of 25%. It is not worth it because, as others have
said, the process is easy.

The easiest way to get an ITIN (tax number) is to apply for it while
you are in the U.S. You can download the form from the IRS website and
take the completed form and your papers to an IRS office. There was no
charge when I did this a few years ago.

However, the ITIN number won't stop the casino from withholding 30%.
They are obliged by law to do withhold this amount from Canadians. A
few years ago I hit a Royal at a strip casino and gave the attendant my
ITIN card. She paid me the full amount of the jackpot. Later that day,
I got a call from the slot director (I was staying in the casino). She
said that I had to give them back 30% of my jackpot. I tried arguing
for a while but she insisted (and I think she was right). For my
trouble the casino gave me a fully comped meal for two at one of their
high end restaurants.

One final word of caution. Do not "pretend" that you had more losses
just to get a higher refund. Quite apart from the fact that it is
illegal, you really do not want to mess with the IRS just to try to
make a few hundred dollars.

Slowpoke