finally back on. Thinking them gifts is your problem. There is no
basis to see cash back or bounce back that way. If you bid $100 in a
charity auction on a $10 book only $90 should be taken as a deduction
on schedule A as you have received something of value for the
donation. May not seem analagous but anything that can knock down
your cost basis must be factored in. Just about everyone takes the
$100 & only come to grief if audited. I am an accountant & have seen
that enough. You must be able to see the worst case scenario & be
prepared for it without random guessing. Can't just post to see your
words appear in public. Your "strategy" cards are not on my xmas list
to be sure.
Michael Boutot wrote:
> As is usually the case your post worries me.
My posts usually worry you? Well, I'll admit that I have made a
few
mistakes in my posts; I think just about everyone who has posted
very
much has, but I've always been honest enough to admit my errors. I
will
extend my apologies to you if you have somehow detrimentally relied
upon
any erroneous info that I've posted. I try to be careful, but I'll
try
to be even more diligent in the future. Now, if it is not my few
errors, then what else do I post which usually worries you? I
suppose
you ought to just quit reading my posts if they bother you; that
would
be the most sensible thing to do, really.
> Taking a line that the
> caino is giving you a gift would not go well in Tax Court ...I will certainly defer to your judgment without the slightest
hesitation
if you can provide any credentials whatsoever which would support
some
professional qualification on your part.. Are you an
accountant? ... a
tax attorney? ... an IRS employee? ... even a tax preparer such as
with
'H & L Block'? ... because if you have nothing else to support
your
"theory" except mere intuition and a 'seat of your pants' opinion,
then
_your_ post worries _me_.
> ... as even
> a "gift" from such a 3rd party in pure theory could be taxable
> anyway. ...And that statement is pretty much erroneous enough for me to
conclude
that you don't really know what you're talking about.
GENERALLY ... in
the absence of any exceptions made by specific tax code
provisions ...
GIFTS are _NOT_ taxable to the recipient under _federal_ taxes. I
am
not going to venture a guess about _state_ taxes, which, with 50
states,
could possibly differ, but I will say that I suspect that MANY, if
not
most, state-taxes are patterned in some fashion after the federal
tax
system. So I now invite you to elaborate a little bit about your
"theory" that gifts from 3rd parties could be taxed anyway -- other
than
what I have already stated. And I assume that you're not going to
claim
that "could" encompasses possible future tax-law changes; your post
was
a direct challenge to mine, and carries with it the implication
that
such a ruling is just a little bit more imminent than that.
You do, know, don't you, that whenever there is a gift tax, it is
paid
by the gift GIVER and not the RECEIVER. If you don't know that,
then I
don't see how you're the least bit qualified to criticize my post,
and
the problem with your 'worries' about my posts might just be due to
your
own misconceptions.
> It being cash brings it into even sharper focus. No 1 would
> ever claim the normal freebies (glasses/shirts/etc) but once you
are
> called in everything can be on the table.
I fail to see any distinction at all between non-cash gifts and
cash-gifts ... unless the regulations themselves make a distinction.And of course, if I read her post correction, even Jean Scott (her
post
below) indicated that this is a 'very gray area'.
Cheers.
Bill Velek
> > Jean Scott wrote:
> >
> > > <<Taxation on gambling income is an inexact science, but the
> > > consensus seems to be that bounce back cash and cash back
> > > should be reported as income.>>
> > >
> > > I don't think there is a consensus really. A very gray area.
> Many
> > > people report cashback and do not count bounce-back. Marissa
and
> I
> > > cover this subject in "Tax Help for the Frugal Gambler,"
coming
> out in
> > > January.
> >
> > Absent a specific tax code provision or ruling by the IRS, I
would
> be
> > inclined to treat them separately. Logically, cash-back is
nothing
> more
> > than a rebate and ought to be used to reduce the amount you
claim
> as
> > losses, but bounce-back has all the earmarks of a gift, which
makes
> it
> > non-taxable. Although I am a lawyer, I am NOT a TAX lawyer ...
and
···
--- In vpFREE@yahoogroups.com, Bill Velek <billvelek@a...> wrote:
> --- In vpFREE@yahoogroups.com, Bill Velek <billvelek@a...> wrote:
> I
> > know next to nothing about taxes, so I could certainly be very
> wrong
> > about this. But I do think that ... if there is not very clear
> guidance
> > from the IRS ... that this would give you something to hand your
> hat on
> > if they claim that you falsified your return. Just my thoughts.
> >
> > Bill Velek