BV3273
BV3273
Joined: Jan 31, 2019
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February 2nd, 2019 at 6:53:40 AM permalink
Got it! Now itís clicking. I had 1.31 mil in loses and 1.21
mil in ďwinsĒ with a net of -10k. I mixed up the numbers. Sorry about that. So basically I do not have to report the $318k at all? I wonder why all of the accountants especially the one who handlers gamblers only told me to include that $318k on other income. Thatís kind of weird.
unJon
unJon 
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February 2nd, 2019 at 6:55:14 AM permalink
Quote: MichaelBluejay

Yet again, no one is suggesting that you report NOTHING, certainly not me. What I actually said, and then repeated, is that you report $1,299,835.52 from the casino report.

But the casino report is not by sessions. Poster said almost all happened in one day, so I think he could greatly reduce what he reports if he goes with the session method instead of what you are suggesting.
The race is not always to the swift, nor the battle to the strong; but that is the way to bet.
CrystalMath
CrystalMath
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MichaelBluejay
February 2nd, 2019 at 7:05:25 AM permalink
Quote: BV3273

Got it! Now itís clicking. I had 1.31 mil in loses and 1.21
mil in ďwinsĒ with a net of -10k. I mixed up the numbers. Sorry about that. So basically I do not have to report the $318k at all? I wonder why all of the accountants especially the one who handlers gamblers only told me to include that $318k on other income. Thatís kind of weird.



Doesnít this kill you on NY income tax? As far as I understand, they limit your itemized deductions when you have a high AGI.
I heart Crystal Math.
MichaelBluejay
MichaelBluejay
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ChumpChange
February 2nd, 2019 at 7:07:58 AM permalink
Quote: BV3273

Got it! Now itís clicking. I had 1.31 mil in loses and 1.21
mil in ďwinsĒ with a net of -10k.

Yes, you did have a net loss, but you can't claim a net loss, so what I said you report was:

Quote: MichaelBluejay

(1) Report your $1,299,835.52 wins on Schedule 1, Line 21.

(2) Report $1,299,835.52 as losses on Schedule A. Your losses were more than this, but you can't claim more in losses than you won.



Quote: BV3273

So basically I do not have to report the $318k at all?

Yes, that's exactly what I said:

Quote: MichaelBluejay

(4) Ignore your W-2G. It's irrelevant.



Quote: BV3273

I wonder why all of the accountants especially the one who handlers gamblers only told me to include that $318k on other income. Thatís kind of weird.

As I explain in the article, this issue is widely misunderstood, and even TurboTax gets it wrong. Part of the problem is that the IRS instructions on the W-2G form are unclear. So, when some accountants say one thing and some accountants say another, then it's time to go to the IRS documents and cases and see what *they* say! :)
DRich
DRich
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February 2nd, 2019 at 7:10:25 AM permalink
I think the way MichaelBluejay said is probably the proper way to file but I would still only claim the $318k because I think that will also minimize the chance of IRS interaction and a possible audit. It will also keep your AGI lower for state income taxes.
Living longer does not always infer +EV
MichaelBluejay
MichaelBluejay
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CrystalMath
February 2nd, 2019 at 7:11:24 AM permalink
Quote: unJon

But the casino report is not by sessions. Poster said almost all happened in one day, so I think he could greatly reduce what he reports if he goes with the session method instead of what you are suggesting.

I missed where he said that all his gambling was from a single session. If that's true, then yes, since the session was a loss, and if he had no other winning sessions for the year, then there are no wins (or losses) to report. He should include a letter explaining why he's not reporting wins even though he got a W-2G, as explained in the article. (I know I'm linking to it a lot, but count the number of times in the other thread where people kept asking for the link.)
BV3273
BV3273
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February 2nd, 2019 at 7:31:25 AM permalink
No worries on the re-linking.

Iím actually looking at the the transaction reports from the time period I played. It was over a 2-3 day period. So 2-3 sessions. Only one resulted in a win. The rest resulted in loses. I live in NY and played on my phone while on vacation in NJ. Iím printing out all of these records (158 pages in all) just in case I need to document any of this to the IRS in the future (hopefully not).

Iím not really sure of the implications on the state. All of the accountants said Iíd have to file an out of state in NJ.

Again Iíd rather be cautious and report the $318k versus little or nothing just to cover myself in case they do come back asking questions.
MichaelBluejay
MichaelBluejay
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ChumpChange
February 2nd, 2019 at 7:33:56 AM permalink
Quote: CrystalMath

Doesnít this kill you on NY income tax? As far as I understand, they limit your itemized deductions when you have a high AGI.

Not just NY, but federal taxes as well! Here's a good article I found on limitations on itemized deductions.

I edited my article earlier to suggest using the W-2G figures if it results in a lower AGI and doesn't change tax liability. BV3273, note that this is a change to my earlier suggestion: Even though the session accounting I suggested to you is correct, you'll probably want to record your $318k W-2G total as your wins on Schedule 1 Line 21, and a $318k loss on Schedule A, to keep your AGI lower so that your deduction isn't limited. Note that even with $318k, your deduction may still be limited!

Yes, it's not fair. Yet another reason that gambling taxes should be abolished.
BV3273
BV3273
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February 2nd, 2019 at 7:52:35 AM permalink
Correct. My account stated that I should report the $318k W-2G total as a win on Schedule 1 Line 21, and a $318k loss on Schedule A. I am going to lose certain deductions such as medical bills, student loan interest,
etc. Iím fine with losing these deductions as long as it doesnít result in further complications down the road.

It sucks my AGI is going to increase, but since I have a record of every transaction I have a little peace of mind.
FinsRule
FinsRule
Joined: Dec 23, 2009
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February 2nd, 2019 at 8:21:31 AM permalink
Are there any potential benefits to having an inflated agi?

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