vpFREE2 Forums

Christmas Quiz

#1

Many casinos offer gift cards as a way of using comps. Even if you had the
option of taking cash, it's better to take the gift cards as cash would count
as gambling income whereas gift cards would not.* (And the gift cards are used
for items that you would normally use cash for anyway.)

For those who earn more comps than they can ever use, the beauty of gift
cards is that it makes your comps portable so that your comps can be used
anywhere you can find a store.

Upon returning from my latest trip to Nevada, it was a pleasant surprise to
find that I'd brought home:

Two $10 Petsmart
Two $10 Rite-Aid
One $50 Safeway
One $ 5 Safeway
One $25 Union 76

In the mail were:

Two $100 Lowes
One $250 Lowes

The quiz is to name the casino offering each gift card. There might be more
than one right answer.

Let's hope this will start other quizzes so that we can all learn something.

* I'm pretty sure I'm right on this statement but I'll defer to those who do
taxes.

Have a warm and joyous holiday :slight_smile:

[Non-text portions of this message have been removed]

#2

<<Many casinos offer gift cards as a way of using comps. Even if you had the
option of taking cash, it's better to take the gift cards as cash would count
as gambling income whereas gift cards would not.* >>

This is a VERY gray area and I can easily see the IRS making a different decision in an audit, perhaps depending on whether you are a "professional" gambler, etc. However, most gamblers that I know do make this distinction: if it's cash, they report it; if it is Free Play, comps, gift cards, they do not count it. Of course, just because a gambler does something and gets by with it doesn't mean it is "right" in the eyes of the IRS.

Gambling regulations are so outdated and so general that one could interpret them MANY different ways, and each IRS employee does the same thing. It has been established in court that "comps" do not have to be counted as income - but what is a "comp"? You earn or win a cruise and you get a 1099 - you better report at least the fair market value of it. Does it make a difference if the "comp" can be used for "things" or taken as cashback, i.e., Coast properties. Gift cards can sometimes be taken instead of cashback - the IRS may not be particular about what FORM the earned points are redeemed for.

I'm just raising questions - with no firm answers. Marissa and I do give some guidelines and options in "Tax Help for the Frugal Gambler." But even in there, we talk about "each case should be judged on its own merit" and "check with your professional tax preparer."

···

________________________________________
Jean $�ott - Go to http://www.FrugalGambler.biz
  for VP software and strategy cards and for the
  Frugal series of books.

#3

<<Many casinos offer gift cards as a way of using comps. Even if

you had the

option of taking cash, it's better to take the gift cards as cash

would

count
as gambling income whereas gift cards would not.* >>

This is a VERY gray area and I can easily see the IRS making a

different

decision in an audit,

No, comps are considered gifts & a cost of doing bizness
as cash or gift cards comps are NOT taxable.
No gray area exist. No tax court decision or regulations or tax law
says otherwise

Also, a 1099g ( prize & awards such as when you place in slot
tournament or winning a cash drawing) are not to be included in your
gamblings winnings on page one of 1040 or as gambling losses as they
are NOT gambling income , the fact you got the 1099g in a casino or
on THE PRICE IS RIGHT makes no difference,

However , the cost of "creating income" is deductabile so your
tournement fees, & transportion cost qualify as expenses if
documented,
AND the words mean the same in IRS as well as in english, a "diary is
a "diary" as "documatation" is "documatation" & "records"
are "records" in either language, keeping this lie alive that somehow
words change meaning goes a long ways to keeping tax preparers working

Get a good tax lawyer if you need help, too many enrolled agents are
ex irs managers, no technical skill at all required. just human
reasource people really.

In fact everybody that on this group can go to irs.gov & use the info
there such as Pub 17 & do ther own taxes better than most
professionals. Evrything said above can found there .
also go to us tax court via google & research decisions made,
might be surprised.

I went through a flame war last year over this, & while i wont go
thru another one, my opinion has not change

Ms Scott as tax help co author ++++++++++++++++

M J Perry

···

--- In vpFREE@yahoogroups.com, "Jean Scott" <QueenofComps@f...> wrote:

#4

Hi M J

Same as you, I don't like the war games many want to play on some
posts. Just quick question. Is diary record the documentation of
choice by IRS? Had an IRS person tell me once, "All you need is a
win loss statement from casion.". It seems ,to me, a diary is more
accurate than a win loss statement. It seems IRS also prefers diary.
It's been a couple years since I got diary from a casion. Some used
to provide diary for their customers if they asked.

Have a good holiday season.......Jeep
.
.

--- In vpFREE@yahoogroups.com, "Jean Scott" <QueenofComps@f...>

wrote:

> <<Many casinos offer gift cards as a way of using comps. Even if
you had the
> option of taking cash, it's better to take the gift cards as cash
would
> count
> as gambling income whereas gift cards would not.* >>
>
> This is a VERY gray area and I can easily see the IRS making a
different
> decision in an audit,

No, comps are considered gifts & a cost of doing bizness
as cash or gift cards comps are NOT taxable.
No gray area exist. No tax court decision or regulations or tax law
says otherwise

Also, a 1099g ( prize & awards such as when you place in slot
tournament or winning a cash drawing) are not to be included in

your

gamblings winnings on page one of 1040 or as gambling losses as

they

are NOT gambling income , the fact you got the 1099g in a casino or
on THE PRICE IS RIGHT makes no difference,

However , the cost of "creating income" is deductabile so your
tournement fees, & transportion cost qualify as expenses if
documented,
AND the words mean the same in IRS as well as in english, a "diary

is

a "diary" as "documatation" is "documatation" & "records"
are "records" in either language, keeping this lie alive that

somehow

words change meaning goes a long ways to keeping tax preparers

working

Get a good tax lawyer if you need help, too many enrolled agents

are

ex irs managers, no technical skill at all required. just human
reasource people really.

In fact everybody that on this group can go to irs.gov & use the

info

···

--- In vpFREE@yahoogroups.com, "mklpryy24" <mklpryy24@y...> wrote:

there such as Pub 17 & do ther own taxes better than most
professionals. Evrything said above can found there .
also go to us tax court via google & research decisions made,
might be surprised.

I went through a flame war last year over this, & while i wont go
thru another one, my opinion has not change

Ms Scott as tax help co author ++++++++++++++++

M J Perry

#5

I've been out of town for 10 days - but kept up on list mail although I couldn't respond from a "foreign" computer - or at least I didn't know how.

Anyway, I must warn people to not depend completely on the opinions of posters here about how to treat gambling on your tax returns. Some posters seem to think their opinions are facts. Anyone who says that there are no gray areas here - I would not put stock in much else they say. There are so many issues the IRS does just does not address clearly - one of the main ones being what a "session" is. This is why you could talk to 10 IRS employees, even high-level ones, and get 10 different answers to the same question.

I want to emphasize that the tax handbook Marissa and I wrote discusses the many issues there are and we have given as much actual IRS published information and court decisions as we could. And we have given examples of how various people handle different unclear areas, like a gambling diary. But we are constantly harping on the concept that each person's situation is unique. Even the IRS writes in one place in the part of the regulations covering gambling: "Your tax liability depends on your particular facts and circumstances."

So let's be careful here to decipher what are facts and what are opinions. I think it is helpful for people to report how they have done something in this area and survived an audit. Although even then, we can't be sure the next auditor would treat you the same way!!!

···

________________________________________
Jean $�ott - Go to http://www.FrugalGambler.biz
  for VP software and strategy cards and for the
  Frugal series of books.

#6

Thanks Jean, very well put. And also, be aware of casinos making misleading statements, such as Boulder Station saying there $1199 VP jackpot is tax free. This isn't the case. All wins are taxeable, the difference is that there is no paperwork until $1200. Just keep records of you rwins and losses as suggested by Jean's and several othe rgood publicatiosn available from Huntington Press, Gambler's Book Store, Gambler's Book Club or the IRS and you should be OK. I do have on equestion to Jean. Any opinions form the IRS or other relaible sources on whether slot club cash is considered as income, rebates on losses, or? I am aware that when used as comps that it usually is not taxed.

···

From: "Jean Scott" <QueenofComps@frugalgambler.biz>
Reply-To: vpFREE@yahoogroups.com
To: "AA Skip's List" <vpmail2@yahoogroups.com>,<vpFREE@yahoogroups.com>
Subject: [vpFREE] Gambling and Taxes
Date: Tue, 4 Jan 2005 12:31:41 -0800

I've been out of town for 10 days - but kept up on list mail although I
couldn't respond from a "foreign" computer - or at least I didn't know how.

Anyway, I must warn people to not depend completely on the opinions of
posters here about how to treat gambling on your tax returns. Some posters
seem to think their opinions are facts. Anyone who says that there are no
gray areas here - I would not put stock in much else they say. There are so
many issues the IRS does just does not address clearly - one of the main
ones being what a "session" is. This is why you could talk to 10 IRS
employees, even high-level ones, and get 10 different answers to the same
question.

I want to emphasize that the tax handbook Marissa and I wrote discusses the
many issues there are and we have given as much actual IRS published
information and court decisions as we could. And we have given examples of
how various people handle different unclear areas, like a gambling diary.
But we are constantly harping on the concept that each person's situation is
unique. Even the IRS writes in one place in the part of the regulations
covering gambling: "Your tax liability depends on your particular facts and
circumstances."

So let's be careful here to decipher what are facts and what are opinions.
I think it is helpful for people to report how they have done something in
this area and survived an audit. Although even then, we can't be sure the
next auditor would treat you the same way!!!
________________________________________
Jean $�ott - Go to http://www.FrugalGambler.biz
  for VP software and strategy cards and for the
  Frugal series of books.

#7

<<Any opinions from
the IRS or other reliable sources on whether slot club cash is considered as
income, rebates on losses, or? I am aware that when used as comps that it
usually is not taxed.>>

There are logical arguments for many different opinions here - but since when is the IRS logical about anything having to do with gambling! In our tax handbook, I say that many players believe that cashback falls under the same category as comps, a reward from the casino that's not gambling income, especially since often you have your choice as to how to take it. Others feel it's more like a rebate of some of your losses and should reduce the total losses that you report. Marissa tells her clients that CB Is gambling income, whereas free buffets aren't. The standard she applies is that cashback is statutory, while a comp is discretionary. She further discusses this in light of Nevada Gaming Control rulings for barred players.

It remains a gray area since the subject has not been addressed by the IRS in any written regulations.

···

________________________________________
Jean $�ott - Go to http://www.FrugalGambler.biz
  for VP software and strategy cards and for the
  Frugal series of books. Now is the time you might
  need "Tax Help for the Frugal Gambler."