http://taxprof.typepad.com/taxprof_blog/2007/03/tax_court_cites.html
Tax Court rules no such thing as professional video poker player
Sounds like this guy was trying to write off his loses. He had
another full time job. If you are a full time gambler with no other
significant souce of income and show steady profits year in and year
out, this ruling shouldn't affect you.
I am not a tax expert so don't take my word as gosple.
Yeah, but is also sounds like the court cast doubt that a person
playing a machine programmed by a casino has an expectation of profit
···
--- In vpFREE@yahoogroups.com, "ebab888" <lsbshsd@...> wrote:
Sounds like this guy was trying to write off his loses. He had
another full time job. If you are a full time gambler with no other
significant souce of income and show steady profits year in and year
out, this ruling shouldn't affect you.I am not a tax expert so don't take my word as gosple.
<<Sounds like this guy was trying to write off his loses. He had
another full time job. If you are a full time gambler with no other
significant source of income and show steady profits year in and year
out, this ruling shouldn't affect you. >>
From "Tax Help for the Frugal Gambler": ... the IRS imposes rigid requirements on anyone wanting to claim gambling as his "business," although these are not all set in stone; individual situations are considered. However, court cases have established that your intent must be to make money; it must not be just a hobby. The Supreme Court has defined a professional gambler as one who gambles "with regularity, continuity, and with an expectation of profit."
One might not meet every single requirement. In some cases, a player who had a full-time non-gambling job has been allowed to file as a professional because he spent "substantial" time gambling. On occasion the profit-three-out-of-five-years rule has been waived for reason. But to convince the IRS, you still have to show that the profession of gambling is the primary one on as many levels as possible: time, earnings, expertise, and record-keeping, etc.
···
________________________________________
Jean $¢ott - "FRUGAL VIDEO POKER"
This new book (autographed) and other
frugal products are now available at my
new Web site, http://queenofcomps.com/.
E-mail address is queenofcomps@cox.net.
[Non-text portions of this message have been removed]
Great article. Just faxed it to my accountant, but I don't play that
way. Although I follow Bob Dancer rules primarily, I also set
effective "stop losses" and when I am ahead a certain ammount I quit
playing for some time. I also come back to a different machine which
mathematically means nothing, but seems to help for me. I also won
money last year, not lost several years in a row. Denny
···
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@...> wrote:
http://taxprof.typepad.com/taxprof_blog/2007/03/tax_court_cites.html
Sounds like this guy was trying to write off his loses. He had
another full time job. If you are a full time gambler with no other
significant souce of income and show steady profits year in and
year
out, this ruling shouldn't affect you.
I am not a tax expert so don't take my word as gosple.
I agree wth you. I am no different that a stock market speculator
and use all the same tools. Maybe the tax court will have another
case in the future to review. As a note according to a recent
Investor's Business Daily article, all the IRS seems to be auditing
are the Schedule "C" people.
As I said recently, I don't need to gamble and will not if I have to
pay foolish taxes. On the other hand I believe I'm no different than
for example a hedge fund betting on swings between $, euros, yen etc.
and I am happy to pay the same taxes these folks do. Denny
···
--- In vpFREE@yahoogroups.com, "ebab888" <lsbshsd@...> wrote:
Yeah, but is also sounds like the court cast doubt that a person
playing a machine programmed by a casino has an expectation of profit
Yes, I am sure you are correct. However a hedge fund currency
speculator uses financial tools to minimize the number of losses and
maximize the gains to overcome the costs of making the trades and thus
overcoming the house edge or rake if you like. Denny
>
> Sounds like this guy was trying to write off his loses. He had
> another full time job. If you are a full time gambler with no other
> significant souce of income and show steady profits year in and
year
···
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@...> wrote:
--- In vpFREE@yahoogroups.com, "ebab888" <lsbshsd@> wrote:
> out, this ruling shouldn't affect you.
>
> I am not a tax expert so don't take my word as gosple.
>
--- In vpFREE@yahoogroups.com, "queenofcomps" <queenofcomps@...>
wrote:
<<Sounds like this guy was trying to write off his loses. He had
another full time job. If you are a full time gambler with no other
significant source of income and show steady profits year in and
year
out, this ruling shouldn't affect you. >>
From "Tax Help for the Frugal Gambler": ... the IRS imposes rigid
requirements on anyone wanting to claim gambling as his "business,"
although these are not all set in stone; individual situations are
considered. However, court cases have established that your intent
must be to make money; it must not be just a hobby. The Supreme Court
has defined a professional gambler as one who gambles "with
regularity, continuity, and with an expectation of profit."
One might not meet every single requirement. In some cases, a
player who had a full-time non-gambling job has been allowed to file
as a professional because he spent "substantial" time gambling. On
occasion the profit-three-out-of-five-years rule has been waived for
reason. But to convince the IRS, you still have to show that the
profession of gambling is the primary one on as many levels as
possible: time, earnings, expertise, and record-keeping, etc.
Jean My accountant and I have read your book and believe we would
meet the criterai. Denny________________________________________
···
Jean $¢ott - "FRUGAL VIDEO POKER"
This new book (autographed) and other
frugal products are now available at my
new Web site, http://queenofcomps.com/.
E-mail address is queenofcomps@...[Non-text portions of this message have been removed]
-
> >
> > Yeah, but is also sounds like the court cast doubt that a
person
> > playing a machine programmed by a casino has an expectation of
profit
> >
>
>
>
> Yes, I am sure you are correct. However a hedge fund currency
> speculator uses financial tools to minimize the number of losses
and
> maximize the gains to overcome the costs of making the trades and
thus
> overcoming the house edge or rake if you like. Denny
>
>This is not analagous. There is no house in the financial markets,
the
closest in casino is horse betting, where the casino gets a cut to
processs the transaction, but they don't care in you win or lose,
because they are not booking the bet, it is going into a pari-
mutual.
The concept of playing against a machine that the casino is booking
the bet and clearly has set the machines to make it mathematically
impossible to win the bet over time.
While in the long run you are absolutely correct and what you say is
irrefutable, I also know that in the short run there is much
oscillation around the long term trend. The greater the variance the
greater the oscillation etc. Some of us believe that knowing
something about these oscillations in general through playing tens of
thousands of hands can give one a fair shot of becoming a winner by
amplifying the positive and minimizing the negatives (like a
financial speculator) by controlling things like bet amount, number
of hands played on a 100 way machine, game type etc. I am not here
to get into a Rob Singer vs. advantage player debate, but I will say
there is more than one way to skin a cat and end up with a favorable
result. You need a very hefty bankroll to do this. I'm not saying
that a court would buy this argument, but I strongly feel that very
little has been written on this aspect over the years regarding video
poker compared to the long range mathematical certainty of perfect
play. Believe me I have tried to obtain everything written that I
could get my hands on over the last several years. Again excuse my
repitition and I know I just brought it up but only as an example. My
post is about taxes and not on how any individual chooses to play
video poker but I felt for clarification what I just said needed to
be said. Denny
···
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@...> wrote:
> --- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@> wrote:
<<Some of us believe that knowing something about these oscillations in
general through playing tens of thousands of hands can give one a fair shot
of becoming a winner by amplifying the positive and minimizing the negatives
(like a financial speculator) by controlling things like bet amount, number
of hands played on a 100 way machine, game type etc.>>
Some of us believe in the tooth fairy.
Cogno
Dennis, Just had to share that I also have a "stop limit" and a "win
limit". I also will play a different machine when I come back for
another session. I don't know about the mathematical thing but I do
know that after many years of playing, if I return to the same machine
I lose horribly. I have tried it repeatedly thinking that
mathematically it doesn't matter. But after so many years, I finally
accepted that i cannot return to the same machine. No idea why..
As for taxes and the courts; I think the courts (federal courts) need
to write clear and simple guidelines and while they are at it; raise
the amount for a W2G - maybe $2K or so...this $1200 really can get you.
>
>
http://taxprof.typepad.com/taxprof_blog/2007/03/tax_court_cites.html
>
Great article. Just faxed it to my accountant, but I don't play
that
way. Although I follow Bob Dancer rules primarily, I also set
effective "stop losses" and when I am ahead a certain ammount I quit
playing for some time. I also come back to a different machine
which
···
--- In vpFREE@yahoogroups.com, "denflo60" <dennis.florence@...> wrote:
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@> wrote:
mathematically means nothing, but seems to help for me. I also won
money last year, not lost several years in a row. Denny
-
> >
> > Yeah, but is also sounds like the court cast doubt that a
person
> > playing a machine programmed by a casino has an expectation of
profit
> >
>
>
>
> Yes, I am sure you are correct. However a hedge fund currency
> speculator uses financial tools to minimize the number of losses
and
> maximize the gains to overcome the costs of making the trades and
thus
> overcoming the house edge or rake if you like. Denny
>
>This is not analagous. There is no house in the financial markets,
the
closest in casino is horse betting, where the casino gets a cut to
processs the transaction, but they don't care in you win or lose,
because they are not booking the bet, it is going into a pari-
mutual.
The concept of playing against a machine that the casino is booking
the bet and clearly has set the machines to make it mathematically
impossible to win the bet over time.
Caplatinum: I like your comments because it is exactly what I would
expect the Court to bring up. I agree that that on any machine
without at least a 100% payout, it is impossible to win over time.
Those are your words but I would add the word "infinite" before the
word time. I go to Vegas about 6 times a year for five or six days
at a time. When I'm there I'll play probably about 6 hours a day
max. I will never in the rest of my life reach infinite. I play for
the short term, which in my case, is trip by trip. I know this is
heresy to discuss on this blog, but I play for the short term. I
generally will play a 50 or 100 play machine and no game that is less
than 99% except where I'm just screwing around. There is no question
that over a long period of time the machine will take all your money
because of the house edge and sometime much much faster because of
the oscillations in the cycle. More variance, greater swings. But
I also believe with stop losses, playing varying number of hands,
different bet sizes, changing games (JorB DDB etc) it is possible to
win in the short run. Can I prove this mathematically, NO, Is there
much in the literature about this, again no. If you hit a positive
swing and apply Kelly Criterion type betting techniques (it only
works on a positive game) you can win. Is my sample size big enough
to prove statistically (absolutely not). However I was in the
Electonic automotive Engineering business for a long long time as
both a designer and manager. We did things that were never done
before. We never violated any laws of physics, but we compensated
for different cycles in the physics (Atmospheric pressure, elevation,
temperature and a hundred more) to optimize fuel economy, gas
mileage, performance etc.
My reference to currency speculation is similar. You look at the
macro economic world and ask yourself how are the world factors going
to influence future relative currency moves? It costs you premiums
to buy or sell money other than $ in the country. Its very
significant if you do it through the bank and is a large number paid
one time. If you buy an ETF (exchange traded fund) it is relatively
small but re occuring like a mutual fund even if you never think
you're paying it. Yet despite all this, people invest in these
things. I consider a video poker machine as being more stable than
the world financial market and therefore I believe the tax treatment
of wins and losses should be similar.
I apologize for my long winded comment and will try to shut up now.
I really do appreciate your comments PS I tried to post a
comment last night and my computer went ape so if last nightr's
comments made it into the the blog and there is some repitition here
I am sorry. Denny
···
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@...> wrote:
> --- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@> wrote:
<<Some of us believe that knowing something about these oscillations
in
general through playing tens of thousands of hands can give one a
fair shot
of becoming a winner by amplifying the positive and minimizing the
negatives
(like a financial speculator) by controlling things like bet amount,
number
of hands played on a 100 way machine, game type etc.>>
Some of us believe in the tooth fairy.
Cogno
Cogno:
Well I'm glad for the $20K the tooth fairy left under my pillow last
year in addition to the 30 days in the Wynn Tower large suites and
food in 11 of their great restaurants. Denny
···
--- In vpFREE@yahoogroups.com, "Cogno Scienti" <cognoscienti@...> wrote:
Dennis, Just had to share that I also have a "stop limit" and
a "win
limit". I also will play a different machine when I come back for
another session. I don't know about the mathematical thing but I
do
know that after many years of playing, if I return to the same
machine
I lose horribly. I have tried it repeatedly thinking that
mathematically it doesn't matter. But after so many years, I
finally
accepted that i cannot return to the same machine. No idea why..
As for taxes and the courts; I think the courts (federal courts)
need
to write clear and simple guidelines and while they are at it;
raise
the amount for a W2G - maybe $2K or so...this $1200 really can get
you.
Miss Deuces: Well your method of play encourages me. I don't feel
so alone anymore. Thank you so very very much. Denny
>
> >
> >
http://taxprof.typepad.com/taxprof_blog/2007/03/tax_court_cites.html
> >
> Great article. Just faxed it to my accountant, but I don't play
that
> way. Although I follow Bob Dancer rules primarily, I also set
> effective "stop losses" and when I am ahead a certain ammount I
quit
> playing for some time. I also come back to a different machine
which
> mathematically means nothing, but seems to help for me. I also
won
···
--- In vpFREE@yahoogroups.com, "missdeuces" <missdeuces@...> wrote:
--- In vpFREE@yahoogroups.com, "denflo60" <dennis.florence@> wrote:
> --- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@> wrote:
> money last year, not lost several years in a row. Denny
>
While in the long run you are absolutely correct and what you say
is
irrefutable, I also know that in the short run there is much
oscillation around the long term trend. The greater the variance
the
greater the oscillation etc. Some of us believe that knowing
something about these oscillations in general through playing tens
of
thousands of hands can give one a fair shot of becoming a winner
by
amplifying the positive and minimizing the negatives (like a
financial speculator) by controlling things like bet amount, number
of hands played on a 100 way machine, game type etc.
You may have played 10's of thousands of hands but I have played
many, many millions and like most long term players here I can state
that any "oscillations" or attempts at "controlling things" simply
are figments of the short term fluctuations you correctly stated
above. Remember these "short term fluctuations" can be a million or
more hands in some games.
One anecdotal evidence of this I have heard many times. I hear "the
machines don't pay back like they used to". Many of these gamblers
started playing after I did. None of these gamblers used perfect
play, they are examples of short term success over many 10's of
thousands of hands followed by a change to normal or poor luck.
I have had times where I wished I had stopped gambling for the day
because my luck changed for the worse ... and, many times where I
kept on winning. I can't tell you the number of times I would have
gone home a loser instead of winning if I had a stop limit.
I've had times where I cashed out when I started to lose and
continued to lose ... or cashed out and started to win. I've had good
luck changing machines ... and, continued bad luck after changing
machines. I've also had both happen staying at one machine.
Just about all gamblers have their superstitions and these
superstitions differ from gambler to gambler so they can't really be
valid.
The bottom line is to do what you are comfortable doing, however, any
attempt to apply some kind of "significance" to these methods will be
met with skepticism.
I am not here
to get into a Rob Singer vs. advantage player debate,
I think you just did.
but I will say
there is more than one way to skin a cat and end up with a
favorable
result.
As in my debates with Robbie I will simply ask for you to provide
more evidence.
You need a very hefty bankroll to do this.
That sounds EXACTLY like Robbie. It would seem to me that the
bankroll is not significant unless one claims high denom machines are
different than lower denom machines. Why do you say this?
I'm not saying
that a court would buy this argument, but I strongly feel that
very
little has been written on this aspect over the years regarding
video
poker compared to the long range mathematical certainty of perfect
play.
The math behind perfect play VP is extremely simple. ASMD. That's all
it takes. The only POSSIBLE way the math is not correct is if the
underlying assumptions are false, that is, the machines are not truly
fair and random. Do you really want to go down that path?
Dick
···
--- In vpFREE@yahoogroups.com, "denflo60" <dennis.florence@...> wrote:
http://taxprof.typepad.com/taxprof_blog/2007/03/tax_court_cites.html
Go to ustaxcourt.gov to read the entire decision, Feb 28 Michael
Ferguson, might get a little different take on it.
The tax payer tried to say is since he practice constantly & played
over 100% payback games that showed he was making an honest attempt
to make a profit. That is what the judge was addressing in that part
of the decision.
This taxpayer had problems that he could not overcome with the tax
court, working full time on a job means to the court( & congress)
you cant be a full time gambler, & a full time gambler is not
allowed by congress to carry forward any loss from 1 tax year to the
next anyway.
& "failure to carry out trade or bizness in profesional manner" by
NOT keeping adequate records, instead he relied upon the the won
loss statement from the casinos.
M J
···
--- In vpFREE@yahoogroups.com, "caplatinum" <belairgold@...> wrote:
Not from the cat's perspective.
[Non-text portions of this message have been removed]
···
On 3/2/07, denflo60 <dennis.florence@worldnet.att.net> wrote:
but I will say
there is more than one way to skin a cat and end up with a favorable
result.
My wife believes that if I watch her play, she will do poorly. If I
don't watch her play, she will win a lot.
···
--- In vpFREE@yahoogroups.com, "mroejacks" <rgmustain@...> wrote:
Just about all gamblers have their superstitions and these
superstitions differ from gambler to gambler so they can't really be
valid.
My wife believes that if I watch her play, she will do poorly. If I
don't watch her play, she will win a lot.
---If I were you, I wouldn't watch her play! 
Scot