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GWAE
GWAE
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December 15th, 2018 at 7:17:35 PM permalink
Quote: AcesAndEights

Quote: GWAE

Quote: MichaelBluejay

For the first part of your question, yes. I didn't call anyone a prick, or come anywhere close to anything that mean or hostile, and never would. Whether what I said qualifies as condescension is debatable, but even if it were, it's an order of magnitude away from calling someone a prick.

For the record, I apologize if anything I said came across as condescension, though I'll admit to being annoyed. People keep asking me questions that I addressed head-on in the article, suggesting they hadn't read it, even though I provided it for the express purpose of answering those kinds of questions. To me, that's kind of rude.

Interestingly, people either seem to hate me or love me, with no middle ground. This was posted on another forum in response to a post I made yesterday:



Yes, TurboTax definitely gets this wrong, and that's not the only thing. I often have to battle it to get the right figures input, in the right place (e.g., self-employed health insurance deduction for S Corporations). TurboTax on the whole is pretty lousy. For gambling income, I ignore the W-2G questions and manually enter an "other income" item that I label "Gambling winnings".

I'm all for complaining about the unfairness of the gambling tax. Someone posted an example of how losses can't effectively be deducted and asked whether he had that right, and whether it seemed fair. Yet my article has *an entire section* titled, in large flaming green letters, "Yes, it's not fair", which details the various unfair aspects, including exactly the one the poster asked about.


Quote: odiousgambit

Was that five $1200 W2s? All five times [fewer is worse] you lost it all back during the same session?

This is taxing my memory (no pun intended) (okay, maybe a little) since it was ten years ago, and I don't have my records handy. I don't remember exactly how many W-2Gs I got or what the amounts were, but I'm sure it was at least five, and I never had a winning session. I think I was wagering $50 or $100 a hand, in a supposedly AP comp situation, and my results on the game itself were way south of expectations.

It could have been talking $38k, I don't really remember. And yeah, it could have been a risk of being contacted, but I honestly wasn't worried. During the first Gulf War I stopped paying taxes in protest because I didn't want my tax money used to kill people. (It was a lot easier to protest back then when I didn't have any money.) I joined a group of other tax resisters (mostly Quaker ladies) who'd been resisting for years, and read books written by former IRS collections officers and the Quaker groups who aggregated the experiences of the resisters, so I felt pretty well versed on how the system worked. Many people seem to quake in fear of the IRS which I think is for the most part unfounded. There's this idea that if you pay your taxes a day late they're gonna be at your door with guns and handcuffs. In reality I've filed and paid taxes as much as 4.5 years late when I got behind, and in most cases when I've been late, even by years, I've barely heard from the IRS. If you do hear from them about an issue that you reported correctly then you just politely show them your evidence and the tax instructions and they'll almost certainly agree with you. If not you can appeal and you'll almost certainly win there. It's not a guarantee, sure, but I'm sure as hell not gonna pay extra tax that I don't really owe just because I fear that the IRS might make an inquiry.

Well, at the risk of getting called a prick again, this has already been done, and is mentioned in the article...twice. The case is Shollenberger v Commissioner.



I certainly did not read every post in this thread and I am not sure how terrible the questions are. I did indeed read your post.

I need to go back and read your article again as my reading comprehension sucks and I didn't realize that there would be this much discussion. If I am recalling correctly you are saying that if I gamble 1 time this year and get a w2g for 2k on my first spin, but before the session is over I lose 5k then I do not have to report any gambling at all on my taxes. However I will get a notice from the IRS that I owe taxes for the missing w2g. But you say we can fight with them and not actually have to pay that tax? If that is the case how likely is that going to trigger and audit? If you finally talk the IRS agent into that argument I would imagine they don't believe the was the case. Taking it a step further. Say you gambled a bunch throughout the year and have 20 w2gs but still never had a winning session. You shouldn't have to pay but I can't imagine the IRS ever believes you didn't have 1 winning session. Maybe I am not understanding any of this but it seems like very few people actually do understand it.


As long as you can back up the facts and circumstances of your gambling activities with a contemporaneous gambling journal, then you are correct in both examples. No gambling winnings need be reported, you will almost certainly be contacted by the IRS, and you will tell them that you follow the session accounting rules and had no winning sessions for the year. Backed up by your journal which shows only losing sessions.



That may be true but I would wager that 99.54% of people who gamble do not count every session and do not keep perfect records. I played poker the other and won $96. It appears nowhere on my records. Even with good records it becomes a matter of convincing an auditor that they are correct and truthful.

It has got to drive agents crazy. In 2001 - 2012 I had nothing to report for gambling. 2013-2015 I had w2g totals with 0 profit. 2016, nothing reported. 2017 w2gs reported. IRS isnt that stupid to think that my gambling was only to the amount of my w2gs and I didnt gamble in 2016.

I guess if you truly keep a correct journal then by all means fight them, but with correct accounting I am sure your agi is going to skyrocket and your taxes will suffer.

If you go to the casino every single day and $1000 with our favorite craps players hit and run strategy, but on the final day you go crazy and lose 364k. You are going to report a 364k win and a loss of 364k on schedule A. Now you are a 1% er and you get crushed at a higher tax bracket and your 50k a year income gets destroyed.
Expect the worst and you will never be disappointed. I AM NOT PART OF GWAE RADIO SHOW
Wizard
Administrator
Wizard
Joined: Oct 14, 2009
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December 15th, 2018 at 8:26:54 PM permalink
Quote: GWAE

If you go to the casino every single day and $1000 with our favorite craps players hit and run strategy, but on the final day you go crazy and lose 364k. You are going to report a 364k win and a loss of 364k on schedule A. Now you are a 1% er and you get crushed at a higher tax bracket and your 50k a year income gets destroyed.



Just so nobody is confused, your taxable income (line 43 of the 1040) is after taking either the itemized or standard deduction. Line 44 is the tax based on line 43.
It's not whether you win or lose; it's whether or not you had a good bet.
FCBLComish
FCBLComish
Joined: Apr 11, 2010
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Thanks for this post from:
DRich
December 15th, 2018 at 9:02:37 PM permalink
Quote: ChumpChange



Also, some casinos cages will check your buy-in at the table if you used a Player's Card and deduct that from your cash-out so you don't trigger a CTR..



This is not true. Cash in and Cash out transactions are always aggregated separately. That's Federal law.
Beware, I work for the dark side.... We have cookies
onenickelmiracle
onenickelmiracle
Joined: Jan 26, 2012
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December 15th, 2018 at 11:55:20 PM permalink
Casinos have a form where you can request copies of w2gs, 1099s, etc. for the year.
In the land of the blind, the man with one eye is the care taker.
WangSanJose
WangSanJose
Joined: May 2, 2012
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December 16th, 2018 at 2:17:50 AM permalink
If wife and husband file tax return together,
wife won a lot in VP,
husband lost a lot in Blackjack,
can husband use his lost to deduct wife's winning?
Great
AcesAndEights
AcesAndEights
Joined: Jan 5, 2012
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December 16th, 2018 at 4:07:09 AM permalink
Quote: GWAE

Quote: AcesAndEights

Quote: GWAE

Quote: MichaelBluejay

For the first part of your question, yes. I didn't call anyone a prick, or come anywhere close to anything that mean or hostile, and never would. Whether what I said qualifies as condescension is debatable, but even if it were, it's an order of magnitude away from calling someone a prick.

For the record, I apologize if anything I said came across as condescension, though I'll admit to being annoyed. People keep asking me questions that I addressed head-on in the article, suggesting they hadn't read it, even though I provided it for the express purpose of answering those kinds of questions. To me, that's kind of rude.

Interestingly, people either seem to hate me or love me, with no middle ground. This was posted on another forum in response to a post I made yesterday:



Yes, TurboTax definitely gets this wrong, and that's not the only thing. I often have to battle it to get the right figures input, in the right place (e.g., self-employed health insurance deduction for S Corporations). TurboTax on the whole is pretty lousy. For gambling income, I ignore the W-2G questions and manually enter an "other income" item that I label "Gambling winnings".

I'm all for complaining about the unfairness of the gambling tax. Someone posted an example of how losses can't effectively be deducted and asked whether he had that right, and whether it seemed fair. Yet my article has *an entire section* titled, in large flaming green letters, "Yes, it's not fair", which details the various unfair aspects, including exactly the one the poster asked about.


Quote: odiousgambit

Was that five $1200 W2s? All five times [fewer is worse] you lost it all back during the same session?

This is taxing my memory (no pun intended) (okay, maybe a little) since it was ten years ago, and I don't have my records handy. I don't remember exactly how many W-2Gs I got or what the amounts were, but I'm sure it was at least five, and I never had a winning session. I think I was wagering $50 or $100 a hand, in a supposedly AP comp situation, and my results on the game itself were way south of expectations.

It could have been talking $38k, I don't really remember. And yeah, it could have been a risk of being contacted, but I honestly wasn't worried. During the first Gulf War I stopped paying taxes in protest because I didn't want my tax money used to kill people. (It was a lot easier to protest back then when I didn't have any money.) I joined a group of other tax resisters (mostly Quaker ladies) who'd been resisting for years, and read books written by former IRS collections officers and the Quaker groups who aggregated the experiences of the resisters, so I felt pretty well versed on how the system worked. Many people seem to quake in fear of the IRS which I think is for the most part unfounded. There's this idea that if you pay your taxes a day late they're gonna be at your door with guns and handcuffs. In reality I've filed and paid taxes as much as 4.5 years late when I got behind, and in most cases when I've been late, even by years, I've barely heard from the IRS. If you do hear from them about an issue that you reported correctly then you just politely show them your evidence and the tax instructions and they'll almost certainly agree with you. If not you can appeal and you'll almost certainly win there. It's not a guarantee, sure, but I'm sure as hell not gonna pay extra tax that I don't really owe just because I fear that the IRS might make an inquiry.

Well, at the risk of getting called a prick again, this has already been done, and is mentioned in the article...twice. The case is Shollenberger v Commissioner.



I certainly did not read every post in this thread and I am not sure how terrible the questions are. I did indeed read your post.

I need to go back and read your article again as my reading comprehension sucks and I didn't realize that there would be this much discussion. If I am recalling correctly you are saying that if I gamble 1 time this year and get a w2g for 2k on my first spin, but before the session is over I lose 5k then I do not have to report any gambling at all on my taxes. However I will get a notice from the IRS that I owe taxes for the missing w2g. But you say we can fight with them and not actually have to pay that tax? If that is the case how likely is that going to trigger and audit? If you finally talk the IRS agent into that argument I would imagine they don't believe the was the case. Taking it a step further. Say you gambled a bunch throughout the year and have 20 w2gs but still never had a winning session. You shouldn't have to pay but I can't imagine the IRS ever believes you didn't have 1 winning session. Maybe I am not understanding any of this but it seems like very few people actually do understand it.


As long as you can back up the facts and circumstances of your gambling activities with a contemporaneous gambling journal, then you are correct in both examples. No gambling winnings need be reported, you will almost certainly be contacted by the IRS, and you will tell them that you follow the session accounting rules and had no winning sessions for the year. Backed up by your journal which shows only losing sessions.



That may be true but I would wager that 99.54% of people who gamble do not count every session and do not keep perfect records. I played poker the other and won $96. It appears nowhere on my records. Even with good records it becomes a matter of convincing an auditor that they are correct and truthful.

It has got to drive agents crazy. In 2001 - 2012 I had nothing to report for gambling. 2013-2015 I had w2g totals with 0 profit. 2016, nothing reported. 2017 w2gs reported. IRS isnt that stupid to think that my gambling was only to the amount of my w2gs and I didnt gamble in 2016.

I guess if you truly keep a correct journal then by all means fight them, but with correct accounting I am sure your agi is going to skyrocket and your taxes will suffer.

If you go to the casino every single day and $1000 with our favorite craps players hit and run strategy, but on the final day you go crazy and lose 364k. You are going to report a 364k win and a loss of 364k on schedule A. Now you are a 1% er and you get crushed at a higher tax bracket and your 50k a year income gets destroyed.


I suggest you begin keeping a gambling journal. It's not that hard.
"So drink gamble eat f***, because one day you will be dust." -ontariodealer
ChumpChange
ChumpChange 
Joined: Jun 15, 2018
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December 16th, 2018 at 5:06:09 AM permalink
Quote: GWAE

I always wondered if these agencies really don't contact each other. When I worked in the census it was always told that nothing that we do gets reported to any other agencies including ice or ins. Do they really not talk at all?



IRS Not Making Much Use Of Bank Currency Reports
https://www.forbes.com/sites/peterjreilly/2018/09/28/irs-not-making-much-use-of-bank-currency-reports/#5ad8590f1ff1
CTR $10,000 line has been around since 1970, and would be 2/3rds of $100,000 today according to the CPI calculator.
Wizard
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Wizard
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December 16th, 2018 at 7:16:02 AM permalink
Quote: WangSanJose

If wife and husband file tax return together,
wife won a lot in VP,
husband lost a lot in Blackjack,
can husband use his lost to deduct wife's winning?



Yes. The accounting is more complicated, but it is as if one person did all the gambling. Someone correct me if I'm wrong.
It's not whether you win or lose; it's whether or not you had a good bet.
AcesAndEights
AcesAndEights
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December 16th, 2018 at 7:17:58 AM permalink
Quote: Wizard

Yes. The accounting is more complicated, but it is as if one person did all the gambling. Someone correct me if I'm wrong.


I agree. It's all on one return, so there would be no way to separate it anyway.
"So drink gamble eat f***, because one day you will be dust." -ontariodealer
Wizard
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Wizard
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December 16th, 2018 at 7:28:57 AM permalink
I found my copy of Tax Help for Gamblers, which is co-authored by my own tax accountant, Marisa Chien. It verifies what I wrote earlier, you can follow the rules and run a high chance of being audited and spend 12-18 months fighting the IRS or enter an amount on line 21 equal or greater than the sum of your W2G forms and deduct whatever necessary on schedule A. Pages 86 to 89 are specifically on this topic, but I'll just quote the last paragraph:

Quote: Tax Help for Gamblers

In summary, reporting a number that's less than your W-2G total is controversial, even among tax professionals, and untested in the courts. Until there are clear instructions from the IRS, as well as definitive court cases, this must be decided on a case-by-case basis and depends on the willingness of the gambler to fight the IRS.

It's not whether you win or lose; it's whether or not you had a good bet.

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