BizzyB
BizzyB
Joined: Nov 26, 2013
  • Threads: 5
  • Posts: 246
January 23rd, 2014 at 10:19:35 AM permalink
I am thinking about incorporating. I am wondering if anyone knows if driving to casinos is a deductible vehicle expense, or if it is considered a commute?
CrystalMath
CrystalMath
Joined: May 10, 2011
  • Threads: 8
  • Posts: 1907
January 23rd, 2014 at 10:35:36 AM permalink
Quote: BizzyB

I am thinking about incorporating. I am wondering if anyone knows if driving to casinos is a deductible vehicle expense, or if it is considered a commute?



Quote: Publication 463


No regular place of work. If you have no regular place of work but ordinarily work in the metropolitan area where you live, you can deduct daily transportation costs between home and a temporary work site outside that metropolitan area.
Generally, a metropolitan area includes the area within the city limits and the suburbs that are considered part of that metropolitan area.
You cannot deduct daily transportation costs between your home and temporary work sites within your metropolitan area. These are nondeductible commuting expenses.



If the casinos are in the metro area where you live, then this would be commuting, and non-deductible.

If the casinos are outside of the metro area, then I would claim the mileage. Definitely, if you travel somewhere overnight, then claim the mileage, hotel, food.
I heart Crystal Math.
CrystalMath
CrystalMath
Joined: May 10, 2011
  • Threads: 8
  • Posts: 1907
January 23rd, 2014 at 10:39:50 AM permalink
Quote: BizzyB

I am thinking about incorporating.



If it's just you, I don't think there's any need to incorporate. I would just file as a sole proprietor and fill out a Schedule C.
I heart Crystal Math.
BizzyB
BizzyB
Joined: Nov 26, 2013
  • Threads: 5
  • Posts: 246
January 23rd, 2014 at 10:52:08 AM permalink
Quote: CrystalMath

If the casinos are in the metro area where you live, then this would be commuting, and non-deductible.

If the casinos are outside of the metro area, then I would claim the mileage. Definitely, if you travel somewhere overnight, then claim the mileage, hotel, food.



No casinos close by, always a drive.
BizzyB
BizzyB
Joined: Nov 26, 2013
  • Threads: 5
  • Posts: 246
January 23rd, 2014 at 10:54:16 AM permalink
Quote: CrystalMath

If it's just you, I don't think there's any need to incorporate. I would just file as a sole proprietor and fill out a Schedule C.



Schedule C's face audit risk or flat out denial. Plus, the main incentive isn't blackjack, it's Obamacare. I want to lower my taxable income; claiming expenses without self-employment taxes would seriously help.
AcesAndEights
AcesAndEights
Joined: Jan 5, 2012
  • Threads: 67
  • Posts: 4299
January 23rd, 2014 at 11:11:58 AM permalink
Quote: BizzyB

Schedule C's face audit risk or flat out denial. Plus, the main incentive isn't blackjack, it's Obamacare. I want to lower my taxable income; claiming expenses without self-employment taxes would seriously help.


Sounds dodgy...the requirements for filing Schedule C as a gambler are different than for other side-businesses (i.e. it has to be your primary source of income and a whole laundry list of other issues). Actually I'm assuming you're a hobbyist like myself based on your response in my other thread about gambling tax laws. If you're a full-time AP the situation is different. Self employment tax would definitely be a pain.

Honestly I don't know the ins and outs of incorporating, but I would definitely do some serious research before including your AP wins and losses there and not on your personal tax return.

If it works, definitely report back here and more power to you!
"So drink gamble eat f***, because one day you will be dust." -ontariodealer
Alan
Alan
Joined: Jun 14, 2011
  • Threads: 17
  • Posts: 582
January 23rd, 2014 at 11:17:08 AM permalink
Quote: BizzyB

Schedule C's face audit risk or flat out denial. Plus, the main incentive isn't blackjack, it's Obamacare. I want to lower my taxable income; claiming expenses without self-employment taxes would seriously help.



I think you want an S-Corp if your intention is to avoid self-employment tax. However, you must pay yourself a 'reasonable salary' or an audit flag gets raised.

http://www.sba.gov/content/s-corporation

Added this link too:

http://blog.turbotax.intuit.com/2010/06/14/6-ways-to-pay-as-little-self-employment-tax-as-legally-necessary/
PapaChubby
PapaChubby
Joined: Mar 29, 2010
  • Threads: 11
  • Posts: 495
January 23rd, 2014 at 11:57:47 AM permalink
Quote: BizzyB

Schedule C's face audit risk or flat out denial. Plus, the main incentive isn't blackjack, it's Obamacare. I want to lower my taxable income; claiming expenses without self-employment taxes would seriously help.



My understanding is that Obamacare subsidies are based on adjusted gross income, not taxable income. Deductions do not affect AGI.
CrystalMath
CrystalMath
Joined: May 10, 2011
  • Threads: 8
  • Posts: 1907
January 23rd, 2014 at 12:24:50 PM permalink
Quote: PapaChubby

My understanding is that Obamacare subsidies are based on adjusted gross income, not taxable income. Deductions do not affect AGI.



Schedule C expenses to reduce your AGI, though.

I'm pretty sure, no matter how you go, you are going to pay employment taxes, assuming that you are profitable. If you are not profitable, and you are just looking to reduce otherwise taxable income with gambling losses, then you are gambling with the IRS; not a position I would want to be in.
I heart Crystal Math.
BizzyB
BizzyB
Joined: Nov 26, 2013
  • Threads: 5
  • Posts: 246
January 23rd, 2014 at 4:38:08 PM permalink
Quote: AcesAndEights

Sounds dodgy...the requirements for filing Schedule C as a gambler are different than for other side-businesses (i.e. it has to be your primary source of income and a whole laundry list of other issues). Actually I'm assuming you're a hobbyist like myself based on your response in my other thread about gambling tax laws. If you're a full-time AP the situation is different. Self employment tax would definitely be a pain.

Honestly I don't know the ins and outs of incorporating, but I would definitely do some serious research before including your AP wins and losses there and not on your personal tax return.

If it works, definitely report back here and more power to you!



Being the primary source of income probably why it would be rejected. I play 15 hours a week, with no deviation on when I play...extremely regular. But because I cannot live on the income, I've read they'd probably reject it.
It does seem dodgy, but from what I can tell it's legal. I can get paid from my normal job and bj as a corp, and deduct expenses from playing bj as well. I'm going to talk to a CPA about it soon. It wouldn't normally be worth the hassle, but my theory is that I can decrease taxable income enough to get subsidized insurance, which will save a few grand.

  • Jump to: