Online Poker Forum - Taxation in the Poker World

kyblue007 · Message Board Junkie Joined: 20 Nov 2006 Posts: 1182

Plus unless the laws have changed since I had a tax course, you can only deduct gambling losses equal to the amount of your winnings. Anything lost above that is just gone and not applicable to any other source of income.

marsupial311 · Royal Flush Joined: 14 Oct 2008 Posts: 503

PlacidCarcass · High Card Joined: 02 Nov 2009 Posts: 2 Location: Canada

Im glad I am in canada, as we do not pay taxes on winnings from gambling Smile

ScizoRShocK · Flush Joined: 26 Aug 2009 Posts: 134

isnt it if u live in las vegas that there r no taxes on gambling winnings?

hghlndr6 · Message Board Junkie Joined: 09 Nov 2006 Posts: 2221

Sand Wedge_100 · Message Board Junkie Joined: 27 Sep 2007 Posts: 1545

JDizzzle72 · Message Board Junkie Joined: 01 Mar 2008 Posts: 3957

thats a really bad idea to do that against the IRS fwiw. interest + fees.

cannonwillow · Posted: Tue Nov 03, 2009 7:14 pm Post subject:

Its going to be real hard keeping track of all money won or lost when I'm playing 8 sessions at a time and using auto topoff. I guess you have include any rakeback from each session and the value of each FTP point (.005 dollar each) gained. and tournament dollars are worth .95 on the dollar, in case you win satellites and unregister.

dodge these · Posted: Tue Nov 03, 2009 7:52 pm Post subject:

I'm prety sure Nil is right, but that just shows another thing the poker lobby needs to address when trying to legalize the game. I don't know how you did it, but if you play hundreds of hands and multitable (with or without autotopoff) it seems next to impossible to keep trakck of the winnings and losees for each individual session. And what exactly counts as a session. Is it when you log on and off from the cleint, or when you get up from a table? What if you sit back down at teh same table right after you can rebuy with less than you left (think of gus table hopping), is each one a new session... but if you decide to sit right back down in a few min with teh same ammount cause your favorite fish showed up, is that still a new session?

Although this apparently is not the case, what the guy from Romania said in terms of treating this more a stock investment where you only pay taxes on the winnings (appreciation of your investemnt) makes much more sense. The fact that does not appear to be the case only reflects the inequity of the US tax code, and how geared it is toward the investor class, where they don't have to pay taxes untill they sell off, even though they can go to any bank and take out a loan against their asset appreciation and use that money, again without a tax laiability, because it is actually a debt they have...

nilgiri · Posted: Tue Nov 03, 2009 8:31 pm Post subject:

PJs Ronin · Posted: Tue Nov 03, 2009 8:47 pm Post subject:

Whatever you think you can claim and think you have to declare does not match what the IRS thinks. Get an accountant.

dodge these · Posted: Tue Nov 03, 2009 9:30 pm Post subject:

I've actually been reading a bit more about this and it does seem that defining just what a session is does mean you might be able to report something like daily winning/losses rather than per table esp if playing same game type and limit... and if that is true than with mixed games both game type and limit keep changing so if you therefore choose to also add a HA tavle and perhaps PLOa nd NL table and 4 table, that could reasonably count as one session, where you just record whether you won or lost whatever ammount when you finished playing. The IRS laws pertain just to live play so this could be a very reasonable interpretation when filing tax returns for online players where tehre are no specifics about what constitutes a session.

What I think is more interesting and murky is whether you can declare bankroll building as an expense. Strictly speaking the code does not adress that, but if you file as a professionl (which is an option) then the money invested in having the proper bankroll for a given stake is certainly a part of doing business and as such an expense. It woudl be ridiculos to say that you are a professinall palyer planning to take on the durrrr challenge with a 200k bankroll. Therefore if you start out with a 200k banroll and ssay you intend to participate in the durrrr chalenge at the end of next year (by which point he will hopefully finish the match with PA) all even if you have a couple of million in winnings after starting out at the 25/50 level and working up, you can reasonably claim that as a business investement.

I mean that's an extreme example, but surely the argument can be made that if you do not witdraw AND also show that you use the additinal winnings to move up in stakes within resoable BRM for a pro player, that in fact those are capital investments rather than taxable winnings. That kind of ties back to what that guy orriginally said about treating your BR as a stock, where your only pay taxes on your winnings after cashing out, only give a legitimate business reinvestment reason for it. Of course if you just keep crushing the same stakes but don't move up and yet never withdraw that argument kind of stops holding watter.

cannonwillow · Posted: Tue Nov 03, 2009 9:53 pm Post subject:

what about money gained through bonuses, promotions, someone transfering you funds, testing software, etc. These sort of gains are over the period of many sessions (talking daily sessions here not table sessions)

And when you transfer someone money due to a lost side bet, can this be deducted Question

dodge these · Posted: Tue Nov 03, 2009 10:14 pm Post subject:

Yeah, just looking at RB and bonuses which can be a significant portion of many multitabler's profits, it really makes very little sense to declare winnings in anything but daily session, and I honestly think this argument could hold water during an audit... and furthermore, any proper legislation realy should have just net yearly (maybe quarterly) profits as taxable, with approriate deductions for reinvestments in BR building. Again, not sayign taht is actually the case, though I do think that with the right accountant depending on teh sate you live in you could (honestly) deduct investments in your bankroll from you taxable income.

finknik · Pair Joined: 11 Jan 2009 Posts: 35 Location: San Diego, CA

Thanks for all the replies.

I just don't see how it could be possible to keep track of all your winnings. When you raise, everyone folds, and you win the blinds, does that count as a profit? This would mean I would have to pay taxes on each pot I win? I just don't see how that could be.

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