vpFREE2 Forums

Proposed IRS changes concerning casinos/gamblers

#1

Since the casinos are against the $600 W2-G issue and will lobby hard to oppose it, I figure it is a waste of time for what would be just a few individual customer complaints. I’m leaving the fight to the casinos.

And I am not going to worry/complain or be excited about what are now JUST proposals. Part of the proposals will be good – recognizing “sessions.” Other parts maybe not so good. Time enough to gripe or rejoice when the regulations become final.

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From: mailto:ac…@…com
Sent: Friday, March 06, 2015 11:30 AM
To: acvpp@yahoogroups.com
Subject: Re: [acvpp] IRS suggests dropping casino W2-G winnings threshold to $600

Is there any place the public can send comments to this proposal? It sucks, but the IRS is probably worried that it will lose out on revenue.

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

#2

I find it very strange that the focus on this board has been
a proposed $600 limit which to me is just a pain in the ass
and will be netted out using the session method and not the
fact that the proposal leaves open the possibility of
including the value of comps and freeplay when determining a
sessions result.

#3

It isn't just a pain in the ass. It is real dollars in situations where game speed and hands per hour is a factor to have the machine lock up for a handpay perhaps 10x as often. Another issue is having to deal with the additional unwanted attention and expectation for tips from slot runners. I have played a few idiotic casinos which set handpays at $500, and it is much more than just a pain in the ass.

I believe earlier in this thread, someone commented that this will mostly impact high rollers. This is not true. At the highest limits, you are already getting frequent W2Gs (perhaps with every full house, and maybe even with a flush or a straight). You probably already have your personal slot attendant keeping close track and right there with a key when the machine needs to be reset.

The people this impacts most are the $0.25-$5 players. At the $1, $2, and $5 levels, many 4-of-a-kinds would become a handpay. At $0.25, you get a w2g for a royal, where previously, you never had to be hassled at all for playing single line quarters.

If they are going to change the limit, they should increase it. In 1977, when the $1200 limit was put in place, it was intended to track only the highest jackpots. Given that adjusting for inflation, $1200 1977 dollars is worth about $4500 2015 dollars, they should be raising the limit to $5000.

#4

Lots of places handpay a 25c royal.

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On Saturday, March 7, 2015 2:16 PM, "emeraldcitybj@yahoo.com [vpFREE]" <vpFREE@yahoogroups.com> wrote:

     It isn't just a pain in the ass. It is real dollars in situations where game speed and hands per hour is a factor to have the machine lock up for a handpay perhaps 10x as often. Another issue is having to deal with the additional unwanted attention and expectation for tips from slot runners. I have played a few idiotic casinos which set handpays at $500, and it is much more than just a pain in the ass.

I believe earlier in this thread, someone commented that this will mostly impact high rollers. This is not true. At the highest limits, you are already getting frequent W2Gs (perhaps with every full house, and maybe even with a flush or a straight). You probably already have your personal slot attendant keeping close track and right there with a key when the machine needs to be reset.

The people this impacts most are the $0.25-$5 players. At the $1, $2, and $5 levels, many 4-of-a-kinds would become a handpay. At $0.25, you get a w2g for a royal, where previously, you never had to be hassled at all for playing single line quarters.

If they are going to change the limit, they should increase it. In 1977, when the $1200 limit was put in place, it was intended to track only the highest jackpots. Given that adjusting for inflation, $1200 1977 dollars is worth about $4500 2015 dollars, they should be raising the limit to $5000.

#5

The proceeds from free play are taxable now (if you file honestly) so that's not really a change.

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Sent from my iPhone

On Mar 7, 2015, at 12:05 PM, joel0457 joel0457@yahoo.com [vpFREE] <vpFREE@yahoogroups.com> wrote:

I find it very strange that the focus on this board has been
a proposed $600 limit which to me is just a pain in the ass
and will be netted out using the session method and not the
fact that the proposal leaves open the possibility of
including the value of comps and freeplay when determining a
sessions result.

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

#6

Not sure what you are basing your opinion on and what
qualifies you to determine whether I am filing my taxes
honestly. Do you have an IRS reg that states that freeplay
is taxable? To me freeplay is not winnings since I did not
risk any of my own money and is no different that any other
comp and not taxable.

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On Sun, 3/8/15, Vegasvpplayer wrote:

       The proceeds from free play are taxable now (if you
file honestly) so that's not really a change.

#7

The proposed changes would be devastating in terms of waste and therefore cost. First consider the already existing problems for most video poker players. There are many hours required to collect and then assemble all the costs associated with itemized deductions so one can claim gambling losses against gambling gains (w2g's). Second, there are potentially hours required to input the w2g's and itemized deduction info into the tax form, if you are using a commercial program such as TurboTax. Third, there is also the administrative cost for the casino, and loss of revenue as players sit waiting for their hand pays and w2gs. And this is not the worst of it. The worst of it is that you will then pay more taxes than you would have, if you had not received any W2G's at all, regardless of whether you won or lost for the year. The artificially high adjusted gross income can cause a higher threshold for the medical deduction and remove the ability to take advantage of tax credits or deductions, such as for educational costs, just to name a couple that effected me. Now consider this with W2gs for amounts between $600-1199. I suspect the number of W2Gs could increase 4X, and the amounts captured might double for someone playing denominations ranging between $ 0.25 and 1.00. As for using the "session method", I am not going to take the audit risk and would likely just quit playing or at a minimum would have to hire a CPA for an otherwise simple personal tax. Yes this is a big deal. Why is the IRS considering these changes? It is rather obvious revenue would increase drastically. Sadly, it would not be a tax not on winnings, but more a tax on recreational gamblers.

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

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On Mar 7, 2015, at 12:05 PM, joel0457 joel0457@yahoo.com [vpFREE] <vpFREE@yahoogroups.com> wrote:

I find it very strange that the focus on this board has been
a proposed $600 limit which to me is just a pain in the ass
and will be netted out using the session method and not the
fact that the proposal leaves open the possibility of
including the value of comps and freeplay when determining a
sessions result.

#8

During my audit I successfully argued $1200 was an arbitrary
number and that W2G's were meaningless and had little impact
on the sessions results.

Therefore, at the end of the year I request a copy of W2G's
from each Casino and include it with my taxes. I then
provide a spreadsheet from my log with one line for each
session. I sum the total of my sessions and that is the
number that goes on my 1040. Not an extremely difficult
process.Now, if I had to include the value of comps and
freeplay it would make the process more complex change many
losing years to winners.

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mdblack2002 wrote:

The proposed changes would be devastating in terms of waste
and therefore cost. First consider the already existing
problems for most video poker players. There are many hours
required to collect and then assemble all the costs
associated with itemized deductions so one can claim
gambling losses against gambling gains (w2g's). Second,
there are potentially hours required to input the w2g's and
itemized deduction info into the tax form, if you are using
a commercial program such as TurboTax. Third, there is also
the administrative cost for the casino, and loss of revenue
as players sit waiting for their hand pays and w2gs. And
this is not the worst of it. The worst of it is that you
will then pay more taxes than you would have, if you had not
received any W2G's at all, regardless of whether you won or
lost for the year. The artificially high adjusted gross
income can cause a higher threshold for the medical
deduction and remove the ability to take advantage of tax
credits or deductions, such as for educational costs, just
to name a couple that effected me. Now consider this with
W2gs for amounts between $600-1199. I suspect the number of
W2Gs could increase 4X, and the amounts captured might
double for someone playing denominations ranging between $
0.25 and 1.00. As for using the "session method", I am not
going to take the audit risk and would likely just quit
playing or at a minimum would have to hire a CPA for an
otherwise simple personal tax. Yes this is a big deal. Why
is the IRS considering these changes? It is rather obvious
revenue would increase drastically. Sadly, it would not be a
tax not on winnings, but more a tax on recreational
gamblers.

#9

Joel,

Given imprecise guidance, I can't see how anyone can take issue with your interpretation, Joel. However, don't expect that interpretation to be reflected should IRS implement casino-based daily session reporting. (Which was your original point.)

---In vpFREE@yahoogroups.com, <joel0457@...> wrote :

Not sure what you are basing your opinion on and what
qualifies you to determine whether I am filing my taxes
honestly. Do you have an IRS reg that states that freeplay
is taxable? To me freeplay is not winnings since I did not
risk any of my own money and is no different that any other
comp and not taxable.

···

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On Sun, 3/8/15, Vegasvpplayer wrote:

The proceeds from free play are taxable now (if you
file honestly) so that's not really a change.

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