3 Handpays in one night

Not really big wins but three handpays in one night is a new record for me. Previously was 2. Hit a Royal Flush for $2k, then another $2k hitting Four Aces with a K on a different machine, both playing Triple Double Bonus VP. Then hit $1800 playing Megabucks slots.

Congrats, my record is 2 in one night but they were for less than your winnings. I did get the same slot attendant paying me both times and she joked "You again? I don't think I can pay this time since you're winning too much!!!"

I have been lucky enough to have over 20 in a single day but I was also playing $50 a spin at the time. In my case every time I hit a wild royal flush on deuces poker it would be a W2G.

good job for making IRS rich

Quote: ViennaPizza

good job for making IRS rich
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Fortunately I can write off my winnings against losses so it’s a wash. No additional taxes. There is something in the works increasing the threshold for W2G to $5000 vs $1200, which was created back in 1973. $5000 would be equivalent to $1200 in 1973.

Quote: ViennaPizza

good job for making IRS rich
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I don't know if I made them rich, but I have no problem paying lots of taxes because that means I am making lots of money. I know very few people that would turn down a $5 million salary because they had to pay 38% federal tax.

Quote: Vegasrider

Quote: ViennaPizza

good job for making IRS rich
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Fortunately I can write off my winnings against losses so it’s a wash. No additional taxes. There is something in the works increasing the threshold for W2G to $5000 vs $1200, which was created back in 1973. $5000 would be equivalent to $1200 in 1973.
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I wonder...

There is the impact of your Adjusted Gross Income going up.

Quote: DRich

Quote: ViennaPizza

good job for making IRS rich
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I don't know if I made them rich, but I have no problem paying lots of taxes because that means I am making lots of money. I know very few people that would turn down a $5 million salary because they had to pay 38% federal tax.
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Exactly right, DRich.

I used to moonlight at H&R Block many, many moons ago. There was one client I'll never forget: he had a 1099 for about 3k and low W-2s. He obviously lived via the cash economy, and I documented that I asked him the requisite questions so I wouldn't get in trouble. That 1099 hurt him, because he didn't have any estimated taxes to go against the income and FICA tax liability. Anyway, instead of a $150 refund, he ended up owing $6 in taxes. Six bucks. His response? He vowed to quit the job that gave him the 1099 so that the next year, he'd get a tax refund. So, he gave up three thousand dollars income to save $156 in taxes.

A lot of folks are like this, refusing to do anything that might raise their taxes, no matter what the income would have been. Getting a jackpot W-2G means, at worst, 37% Fed taxes and 13.3% (California) state taxes, for a combined marginal rate of 50.3%. I suppose one passes a tipping point when the total marginal passes 50%, but that's an individual call.
(All rates courtesy of www.TaxFoundation.org)

Frankly, I live in a state where the max rates are 7%, and thus the worst it could get is 44%. I dunno, I'll still take a W-2G of 100k. I'll be 56k to the good instead of zero, and that sounds OK to me. At my current AGI, I really don't have to worry about bracket creep unless I get three of them, and even then, I'm still to the good by $150k.

The more money you make the IRS, the more money you get to keep.

Adj. gross income goes up on 1099’s. I got one from winning the damn slot tournament last year. W2G is different, if you itemize you can claim up to your losses. Some people end up using the standardized deduction, I think it’s around $12500? If you go that route, than you are unable to write off the losses and it will go towards your income. Either don’t play anything that will get you a W2G or if you do, better get a lot of ‘em.

Quote: Vegasrider

Adj. gross income goes up on 1099’s. I got one from winning the damn slot tournament last year. W2G is different, if you itemize you can claim up to your losses. Some people end up using the standardized deduction, I think it’s around $12500? If you go that route, than you are unable to write off the losses and it will go towards your income. Either don’t play anything that will get you a W2G or if you do, better get a lot of ‘em.
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W2G's definitely have an effect on your AGI. It doesn't matter if you can write them off your AGI is still increased. As you probably know AGI stands for adjusted gross income. Gross is the key word there, it is all income whether or not you can write it off.

Quote: Vegasrider

Adj. gross income goes up on 1099’s. I got one from winning the damn slot tournament last year. W2G is different, if you itemize you can claim up to your losses. Some people end up using the standardized deduction, I think it’s around $12500? If you go that route, than you are unable to write off the losses and it will go towards your income. Either don’t play anything that will get you a W2G or if you do, better get a lot of ‘em.
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The difference between the two is that W2Gs are specifically designed for gambling winnings. They do increase your AGI (all income does that, including interest, dividends, and gains from asset sales.

A 1099-MISC, on the other hand, is a record from one party to another that Party 1 paid x dollars to Party 2 for a product, good, or service. These 1099s end up as gross profits on Party 2's Schedule C, and since this can be considered employment, the net amount is also subject to FICA taxes, which are 15.3% IIRC. Yes, 1099-MISC can be used for other transactions. They result when Party 1 is claiming those expenses from their business.

I received a 1099 for winning a drawing at a casino. You can still offset it with losses since you had to gamble to qualify for the drawing.

Quote: AlanMendelson

I received a 1099 for winning a drawing at a casino. You can still offset it with losses since you had to gamble to qualify for the drawing.
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That one is a little fuzzy based on different CPA's opinions.

Quote: DRich

Quote: AlanMendelson

I received a 1099 for winning a drawing at a casino. You can still offset it with losses since you had to gamble to qualify for the drawing.
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That one is a little fuzzy based on different CPA's opinions.
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Exactly. Ask a dozen tax pros, and you'll get several different answers.

I went with the instructions from the IRS in their booklet.

If you can qualify to file Schedule C, then only net winnings drop to your AGI. If you have a tax program, you can prove this to yourself by creating a test filing where you net your W/L on Sched C.. I have offset millions worth of W2-Gs over the years on Sched C. The IRS is cool with this. If you cannot file Schedule C as a pro gambler, then the 2017 tax law has really screwed you. Due to the SALT cap from this same law, almost everyone will pay extra taxes on gross W2Gs even if they have no net income from gaming.