Joeman
Joeman
Joined: Feb 21, 2014
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February 1st, 2019 at 4:54:14 AM permalink
I am not an accountant, or know anything about taxes, but MBJ posted recently about this, saying a total of "session wins," and not an aggregate of your W-2G's are what you put down for gambling income. I'm sure this would make for a more palatable figure for your AGI. There is also a link to his article there that goes into more detail.

I don't play online, but I've got to think there is a record of all your wagers somewhere, and you might be able to piece together a detailed log of your sessions, assuming you don't already have one.
"Dealer has 'rock'... Pay 'paper!'"
FinsRule
FinsRule
Joined: Dec 23, 2009
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February 1st, 2019 at 7:29:07 AM permalink
Based on this thread, my uneducated opinion is that you are screwed.
TigerWu
TigerWu
Joined: May 23, 2016
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February 1st, 2019 at 10:07:51 AM permalink
Doesn't seem fair to tax someone on money they never cashed out.

If this was the stock market, that would be unrealized gains. But I guess gambling tax laws are different.
unJon
unJon
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February 1st, 2019 at 10:13:05 AM permalink
Quote: Joeman

I am not an accountant, or know anything about taxes, but MBJ posted recently about this, saying a total of "session wins," and not an aggregate of your W-2G's are what you put down for gambling income. I'm sure this would make for a more palatable figure for your AGI. There is also a link to his article there that goes into more detail.

I don't play online, but I've got to think there is a record of all your wagers somewhere, and you might be able to piece together a detailed log of your sessions, assuming you don't already have one.



This.
The race is not always to the swift, nor the battle to the strong; but that is the way to bet.
AcesAndEights
AcesAndEights
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February 1st, 2019 at 10:46:55 AM permalink
Quote: Joeman

I am not an accountant, or know anything about taxes, but MBJ posted recently about this, saying a total of "session wins," and not an aggregate of your W-2G's are what you put down for gambling income. I'm sure this would make for a more palatable figure for your AGI. There is also a link to his article there that goes into more detail.

I don't play online, but I've got to think there is a record of all your wagers somewhere, and you might be able to piece together a detailed log of your sessions, assuming you don't already have one.


Yeah, we just talked about this extensively about a month ago. Read that thread ^^ from the start.

Short answer, you will probably be okay on your fed return as long as you can construct a journal showing losses. You're supposed to do this contemporaneously, but given that you have a win/loss statement and it's all trackable online, you can probably get by after the fact.

I don't know anything about New York State. Even if they don't allow you to deduct gambling losses (common for many dumb states), you may be able to use the same session accounting to show a gross win much lower than that total. You said most of the big hands happened on one day right? That could be one session, and if you didn't win that session, then your gross gambling winning will be much lower than the $318k.

Good luck.
"So drink gamble eat f***, because one day you will be dust." -ontariodealer
Nathan
Nathan
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February 1st, 2019 at 11:02:13 AM permalink
Quote: TigerWu

Doesn't seem fair to tax someone on money they never cashed out.

If this was the stock market, that would be unrealized gains. But I guess gambling tax laws are different.



That's exactly what I'm saying. Seems beyond messed up to tax money that was LOST.
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Hullabaloo
Hullabaloo
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February 1st, 2019 at 11:14:31 AM permalink
Quote: TigerWu

Doesn't seem fair to tax someone on money they never cashed out.

If this was the stock market, that would be unrealized gains. But I guess gambling tax laws are different.



from http://www.taxabletalk.com/2016/02/13/north-carolina-added-to-bad-states-for-gamblers/

Quote:

CT, IL, IN, KS, MA, MI, NC, OH, RI, WV, and WI do not allow gambling losses as an itemized deduction. These statesí income taxes are written so that taxpayers pay based (generally) on their federal Adjusted Gross Income (AGI). AGI includes gambling winnings but does not include gambling losses. Thus, a taxpayer who has (say) $100,000 of gambling winnings and $100,000 of gambling losses will owe state income tax on the phantom gambling winnings. (Michigan does exempt the first $300 of gambling winnings from state income tax.)

gordonm888
gordonm888
Joined: Feb 18, 2015
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February 1st, 2019 at 10:34:28 PM permalink
CT, IL, IN, KS, MA, MI, NC, OH, RI, WV, and WI do not allow gambling losses as an itemized deduction. These statesí income taxes are written so that taxpayers pay based (generally) on their federal Adjusted Gross Income (AGI). AGI includes gambling winnings but does not include gambling losses. Thus, a taxpayer who has (say) $100,000 of gambling winnings and $100,000 of gambling losses will owe state income tax on the phantom gambling winnings. (Michigan does exempt the first $300 of gambling winnings from state income tax.)

I have been screaming about this in this forum for a year!!! These tax rules are going to have a negative effect on the gaming industry.

23.1% of the US population currently live in states where gambling losses cannot be itemized so as to off-set gambling winnings on state tax returns.

And with a $24,000 standard deduction on federal returns . . .
MaxPen
MaxPen
Joined: Feb 4, 2015
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February 2nd, 2019 at 12:14:32 AM permalink
Quote: gordonm888

CT, IL, IN, KS, MA, MI, NC, OH, RI, WV, and WI do not allow gambling losses as an itemized deduction. These statesí income taxes are written so that taxpayers pay based (generally) on their federal Adjusted Gross Income (AGI). AGI includes gambling winnings but does not include gambling losses. Thus, a taxpayer who has (say) $100,000 of gambling winnings and $100,000 of gambling losses will owe state income tax on the phantom gambling winnings. (Michigan does exempt the first $300 of gambling winnings from state income tax.)

I have been screaming about this in this forum for a year!!! These tax rules are going to have a negative effect on the gaming industry.

23.1% of the US population currently live in states where gambling losses cannot be itemized so as to off-set gambling winnings on state tax returns.

And with a $24,000 standard deduction on federal returns . . .



Time for the casinos to have some Pay Your Tax promotions.
BV3273
BV3273
Joined: Jan 31, 2019
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Thanks for this post from:
ChumpChangetringlomane
February 2nd, 2019 at 4:14:56 AM permalink
Update:

I spoke with 3 different accountants. One of which whoís practice solely focuses on pro and amateur gamblers - he has offices in South NJ and Vegas. They all stated the same thing. Report all of the $318,000 on the W2G and write it all off as gambling losses. Also, the win/loss statement actually holds sway. With online gambling the old adage of keeping a diary is not necessarily needed because each hand is actually recorded and can be printed out - therefore they create the diary for you. I confirmed this with Borgata online both via phone call and email. They walked me through this process to gather this information.

In essence my AGI is going to increase for 2018. Thankfully I am not applying for any sort of loans or anything else.

Basically these wins triggered the W2G because the total win for the hand was over $1,200. For whatever reason online casinos consider online blackjack the same they would as a slot machine win. Kind of unfair, but it is what it is.

I thank everyone for all of the advice. Albeit some of the posts wanted me to look for the highest point in my building, open a window, and jump out.

My biggest lesson is this. If you are going to play online try not to trigger those W2G wins by keeping bet maximums to a lower amount.

I hope this post saves someone the sleepless night I had. I came to this site not knowing anyone and the whole community stepped up to try and help me. Iím extremely grateful!

Best of luck everyone!
-BV

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