4a. Re: W2G
Caveat: I am not a tax pro, just know what I read and what people tell me, so I may not be adding anything worthwhile, and could even be wrong.
To me the key is not so much "how you file" those W2Gs, although there is certainly merit in NOT doing it in such a way as to AUTOMATICALLY generate an audit, as it is having adequate records to withstand the audit if it comes. I have other reasons I can't file electronically, and I can't comment on any restrictions on that, although it would seem to me that scanning a stack of W2Gs and attaching that file to the return might meet the requirements (but just because I think so, doesn't make it OK with the IRS -- since I don't do electronic myself, I have no idea whether they allow electronic attachments). If possible, I'd rather send in the documentation with my return to begin with, than to wait to show it at an audit.
From what I've read (and heard on this list), a contemporaneous gambling log is the best documentation. My gambling log includes the usual session information, but in addition, if there are W2Gs, the session information also includes something like "includes W2G for $X,XXX". Every W2G is thus accounted for explicitly in the log, so that if I've hit a royal but lost $2,000 getting there that session, the W2G is accounted for, but so is the reported session result of a win of less than the W2G amount. If you're playing higher denominations that generate a bunch of W2Gs, I'd expect it would not be uncommon even to have losing sessions with a W2G.
My "log" is very very simple -- a stack of hand-written 3x5 cards with session results, sometimes with several sessions on a card if they fit -- each one shows date, time played, place played, game played, session outcome -- and if a W2G is generated, that is there too.
I do use an accountant for my tax returns (in spite of their ignorance of gambling tax laws -- I need them for other, more complicated things that they are actually expert in because more of their clients encounter them) -- I summarize the session data into a document that is more legible than my original note cards, for the accountant's convenience, and that document just has date, place, and win/loss amount. The accountant has said that's good enough for him (and for his assistant, a "her"), but I still keep the 3x5's for a long time, just in case, assuming that the clearly contemporaneous log will be good evidence if I'm audited. They don't take that much space; I bundle them with a rubber band at the end of the year, throw them in a box, and clear out the ones older than 6 years every so often.
--BG
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--BG
You usually have to put a "date won" next to the casino
entries. As a
non-pro, for example, I'd be nervous listing one $100,000
win dated December
31 ( assuming your last jackpot was then ) , versus 20 $5000
hits scattered
about during the year. The logic being, for audit profiling
, maybe he's a
person that hit a big jackpot in late December , got
lucky, and is likely a
winner for the year. Are you saying it dont matter, they
pull up their
records , see that its really 20 hits not one ?
best...Tom