vpFREE2 Forums

re IRS tax code and W2Gs

#21

I totally agree with EE! In Wisconsin, I would own more taxes in a year than I could ever pay and on a small earnings to boot. They want taxes on every penny of winnings if it is put back into the machine or not.

>
Get & keep win-loss statements from casinos for
> unquestioned proof. Check with your accountant, I believe he will
agree.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

I've mentioned this before, but I'll say it one more time even though
I know a lot of people will disagree. Personally, I wouldn't touch a
casino win-loss statement with a 10 foot pole. And I would certainly
never, never, never show one of these to any government agent. I
don't ever ask for these from any casino, but I have received them
(unsolicited) once or twice. The last one I got showed coin in and
coin out totals for the year for losses and wins (in other words,
these huge numbers). On top of that, it was inaccurate. Worst case
scenario is that you show that to the IRS and some yahoo rookie agent
decides that you should be showing "coin out" as your gambling
winnings. After all, that's what the statement lists as your
winnings. And you thought showing W2-G totals was bad... :slight_smile:

EE

···

eecounter <eecounter@hotmail.com> wrote: --- In vpFREE@yahoogroups.com, "bobveit" <bobveit@...> wrote:

---------------------------------
Everyone is raving about the all-new Yahoo! Mail beta.

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

#22

Well, either I am not in my right mind (certainly possible) or I qualify.

I have never received a W2G. I have averaged net gambling wins of
around $6000 each of the last 3 years. I have paid my taxes on these
wins, in some cases paying extra due to income phase-outs of some of
my typical deductions.

I believe there are significant inequities in the tax law for
gamblers. However, I also think it is wrong to simply not pay taxes
on these grounds.

Ken

···

>>>What do you do with the "winning" sessions when you don't have a
W2G. Where do you put that?

You don't put it any where. (Yes, I know ALL gambling income is
taxable as is finding money on the ground and any other source of
income even illegal activity such as robbery). Honestly though, who
in their right mind would claim gambling wins if there isn't a paper
trail of W2G's??? No one I know that has had a winning year and no
W2G's ever claimed any of their wins. On the same note I don't know
w single person that ever claimed money they found on the floor!

#23

I certainly do not agree with this. Let's say I go to the casino for
2 hours just one time in the year. I sit down at a $1 9/6 JoB machine
and put $500 into the machine. I play and lose down to $80 when I hit
a royal flush for a $4000 hand-pay and W2G. I then play off the
remaining $80 and leave.

I clearly won just $3500 while playing. Why should I have to declare
winnings of $4000? There does not seem to be anything in the tax code
that states my winnings were $4000 for tax purposes...and clearly the
W2G was just part of the session as a whole, not a session in and of
itself...

Ken

···

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

OK, point taken. That's the way it should be. However would you
concur that line 21 should never be less than your total amount of
W2G's?? That it should be W2G's plus winning sessions. Schedule A
should be total of losing sessions (up to the amount of your wins)?

#24

kkirschner wrote:
>
> I certainly do not agree with this. Let's say I go to the casino for
> 2 hours just one time in the year. I sit down at a $1 9/6 JoB machine
> and put $500 into the machine. I play and lose down to $80 when I hit
> a royal flush for a $4000 hand-pay and W2G. I then play off the
> remaining $80 and leave.
>
> I clearly won just $3500 while playing. Why should I have to declare
> winnings of $4000? There does not seem to be anything in the tax code
> that states my winnings were $4000 for tax purposes...and clearly the
> W2G was just part of the session as a whole, not a session in and of
> itself...

That is why you can list the losses.

#25

In this scenario, I played once and lost. There were no winnings.
Since there were no winnings, I cannot offset anything with losses.

···

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

kkirschner wrote:
>
> I certainly do not agree with this. Let's say I go to the casino for
> 2 hours just one time in the year. I sit down at a $1 9/6 JoB machine
> and put $500 into the machine. I play and lose down to $80 when I hit
> a royal flush for a $4000 hand-pay and W2G. I then play off the
> remaining $80 and leave.
>
> I clearly won just $3500 while playing. Why should I have to declare
> winnings of $4000? There does not seem to be anything in the tax code
> that states my winnings were $4000 for tax purposes...and clearly the
> W2G was just part of the session as a whole, not a session in and of
> itself...

That is why you can list the losses.

#26

Darn it...I hit send when I meant to hit preview...so that I could
re-read things to make sure I said what I wanted to...which,
naturally, I did not...

I meant to say that I played once and lost my initial stake. The
winnings were less than the W2G amount. Clearly using $4000 as my
winnings is NOT accurate. I won $3500, not $4000.

Ken

···

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

kkirschner wrote:
>
> I certainly do not agree with this. Let's say I go to the casino for
> 2 hours just one time in the year. I sit down at a $1 9/6 JoB machine
> and put $500 into the machine. I play and lose down to $80 when I hit
> a royal flush for a $4000 hand-pay and W2G. I then play off the
> remaining $80 and leave.
>
> I clearly won just $3500 while playing. Why should I have to declare
> winnings of $4000? There does not seem to be anything in the tax code
> that states my winnings were $4000 for tax purposes...and clearly the
> W2G was just part of the session as a whole, not a session in and of
> itself...

That is why you can list the losses.

#27

Is it not that you have a $4,000 winner (the W2-G) and that goes on line 21. You had a $500
"loss". That goes on Schedule A, if you itemize.

Just a guess...

.....bl

···

--- In vpFREE@yahoogroups.com, "kkirschner" <ken.kirschner@...> wrote:

I meant to say that I played once and lost my initial stake. The
winnings were less than the W2G amount. Clearly using $4000 as my
winnings is NOT accurate. I won $3500, not $4000.

Ken

#28

That's certainly how some would say it should be done. However, that
does not accurately reflect the situation. The accurate report would
be a $3500 win with no offsetting losses. This is the interpretation
that makes the most sense to me. It also minimizes conflicts with
other portions of the tax code -- such as education credits, the true
deductibility of itemized deductions, etc.

Basically, the tax code is, at best, ambiguous. If the IRS wants to
work on a basis of winnings = W2G and you can then offset by itemizing
losses, *I* would be thrilled. I have $4000 in gambling winnings this
year without any W2Gs. So this interpretation would mean I pay no
taxes. But I don't think this is really want they want...

Ken

> I meant to say that I played once and lost my initial stake. The
> winnings were less than the W2G amount. Clearly using $4000 as my
> winnings is NOT accurate. I won $3500, not $4000.

Is it not that you have a $4,000 winner (the W2-G) and that goes on

line 21. You had a $500

···

"loss". That goes on Schedule A, if you itemize.

#29

In some ways my thinking is that this works just like the 1099-INT's from "banks" for
interest earned on a savings account, for instance. Some banks do not issue 1099-INT's
for "interest" amounts under $10. However, the IRS expects you to claim any "less than
$10" amount as income.

I think it was said in various earlier postings that line 21 can be higher that the sum of
W2-G's, in the same way as your "interest" income can be greater than the sum of your
1099-INT's.

Again, this is just an opinion. But, you did use the correct word when you said
"ambiguous", as pertains to the IRS code.

.....bl

···

--- In vpFREE@yahoogroups.com, "kkirschner" <ken.kirschner@...> wrote:

That's certainly how some would say it should be done. However, that
does not accurately reflect the situation. The accurate report would
be a $3500 win with no offsetting losses. This is the interpretation
that makes the most sense to me. It also minimizes conflicts with
other portions of the tax code -- such as education credits, the true
deductibility of itemized deductions, etc.

Basically, the tax code is, at best, ambiguous. If the IRS wants to
work on a basis of winnings = W2G and you can then offset by itemizing
losses, *I* would be thrilled. I have $4000 in gambling winnings this
year without any W2Gs. So this interpretation would mean I pay no
taxes. But I don't think this is really want they want...

Ken

> > I meant to say that I played once and lost my initial stake. The
> > winnings were less than the W2G amount. Clearly using $4000 as my
> > winnings is NOT accurate. I won $3500, not $4000.
>
> Is it not that you have a $4,000 winner (the W2-G) and that goes on
line 21. You had a $500
> "loss". That goes on Schedule A, if you itemize.

#30

But your taxs are based on the $4000 instead of the actual $3500,
what if you do not have enough deductions to use schedule A.

They end up paying taxs on $500 that they did not win.

On top of that the first $500 that you take with you as a bankroll
has already been taxed, so you are paying taxs on it twice.

Jacob

···

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

That is why you can list the losses.