vpFREE2 Forums

Taxes on IL W2Gs

#1

The IL state income tax is based on your Federal Adjusted Gross Income
(There are some additions and subtractions but those do not apply to
casino gaming) so unless you file as a professional gambler you are out
of luck. One note: IL residents who collect W2Gs in other states with
state income taxes can deduct the other state's tax only to the extent
that they would pay in IL (currently 3%). Ex: IN is 3.4% so a $2,000
W2G would have $68 withheld but you can only reduce the IL tax by $60.
Since the W2G would be part of the Federal Adjusted Gross Income you
would effectively pay the full $68.

Also note that in MS the 3% is not a tax, you cannot deduct it in IL.
Note: Filing as a professional gambler is an excellent way to trigger
an audit!

#2

Ditto in CT (5%). Legislators aren't very sympathetic to changing it
anytime soon. Agreed very unfair. Also, why isn't a W2G triggered if
I win a 1500 hand at BJ? Same principle. Ridiculous law.

The IL state income tax is based on your Federal Adjusted Gross

Income

(There are some additions and subtractions but those do not apply to
casino gaming) so unless you file as a professional gambler you are

out

···

of luck.

#3

I don't understand how Illinois could tax our entire income when we
don't live in the state or work in the state; we just won a jackpot
in one of their casinos when visiting the area. We pay our taxes to
the state we live in so how can Illinois tax us as well?

Ditto in CT (5%). Legislators aren't very sympathetic to changing

it

anytime soon. Agreed very unfair. Also, why isn't a W2G

triggered if

I win a 1500 hand at BJ? Same principle. Ridiculous law.

> The IL state income tax is based on your Federal Adjusted Gross
Income
> (There are some additions and subtractions but those do not

apply to

> casino gaming) so unless you file as a professional gambler you

are

···

--- In vpFREE@yahoogroups.com, "cbivitz99" <quadcity@...> wrote:

out
> of luck.

#4

--- In vpFREE@yahoogroups.com, "howardwstern" <howard.w.stern@...>
wrote:

Also note that in MS the 3% is not a tax, you cannot deduct it in IL.
Note: Filing as a professional gambler is an excellent way to trigger
an audit!

I'm not sure I would be so quick to concede this point if I lived in
IL. Has IL actually published a negative ruling regarding the
deduction of gambling taxes paid to Mississippi???

The MS 3% withholding for W2-G events is definitely a tax, even though
it is non-refundable from Mississippi. As I recall, MS actually
referred to this as a "non-refundable state income tax on gambling
winnings" when it was first put into effect. Sure sounds like a tax to
me. Anyone interested may want to check the instructions on the
Mississippi state tax forms to see if they still use similar wording.
And it sure looks like "state income tax withheld" on the W2-G forms
you get from Mississippi. If I lived in IL and has W2-Gs from
Mississippi, I would definitely try to get my CPA to push this issue.

EE

#5

You will get a credit in your home state for any income taxes paid in another state.

···

----- Original Message -----
  From: gamblinggrandma
  To: vpFREE@yahoogroups.com
  Sent: Wednesday, September 19, 2007 12:26 AM
  Subject: [vpFREE] Re: Taxes on IL W2Gs

  I don't understand how Illinois could tax our entire income when we
  don't live in the state or work in the state; we just won a jackpot
  in one of their casinos when visiting the area. We pay our taxes to
  the state we live in so how can Illinois tax us as well?

  --- In vpFREE@yahoogroups.com, "cbivitz99" <quadcity@...> wrote:
  >
  > Ditto in CT (5%). Legislators aren't very sympathetic to changing
  it
  > anytime soon. Agreed very unfair. Also, why isn't a W2G
  triggered if
  > I win a 1500 hand at BJ? Same principle. Ridiculous law.
  >
  >
  > > The IL state income tax is based on your Federal Adjusted Gross
  > Income
  > > (There are some additions and subtractions but those do not
  apply to
  > > casino gaming) so unless you file as a professional gambler you
  are
  > out
  > > of luck.
  >

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

#6

--- In vpFREE@yahoogroups.com, "howardwstern" <howard.w.stern@>
wrote:
>
> Also note that in MS the 3% is not a tax, you cannot deduct it in

IL.

> Note: Filing as a professional gambler is an excellent way to

trigger

> an audit!
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

I'm not sure I would be so quick to concede this point if I lived

in

IL. Has IL actually published a negative ruling regarding the
deduction of gambling taxes paid to Mississippi???

The MS 3% withholding for W2-G events is definitely a tax, even

though

it is non-refundable from Mississippi. As I recall, MS actually
referred to this as a "non-refundable state income tax on gambling
winnings" when it was first put into effect. Sure sounds like a

tax to

me. Anyone interested may want to check the instructions on the
Mississippi state tax forms to see if they still use similar

wording.

And it sure looks like "state income tax withheld" on the W2-G

forms

you get from Mississippi. If I lived in IL and has W2-Gs from
Mississippi, I would definitely try to get my CPA to push this

issue.

EE

Interesting! I have never had a W2G in MS so I have not looked into
that. I actually do hold a CPA license in IL but I do not practice as
one. I have had to deal with W2Gs from IN and MO. The MO pair were
from about six years ago and back then the MO tax form was fairly
complicated. Also amazingly at the time, the state goernment had
underspent it's budget and actually sent me a $6 refund from my $298
tax bill. (They did not withhold back then on my two W2Gs totalling
$8,590.)

···

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