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sltploppy
sltploppy
Joined: Feb 5, 2017
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Thanks for this post from:
odiousgambitLottoballs
December 15th, 2018 at 3:15:03 AM permalink
My experience with tax filing software (Turbotax) is consistent with what 7craps has outlined. It has me enter each W2G individually which it then sums up into a total that it places on line 21 of Form 1040.

I also had an experience with my 2016 return where I missed entering a few W2G's and late in 2017 received a collections letter from the IRS demanding payment for an additional tax liability attributable to those W2G's. I had to file an amended return to account for the missing W2G's and then increasing my loss offset in order to remove the liability (I was a net loser for the year), That one is still in progress though and I would not be surprised if an audit will be forthcoming. Fortunately, I believe I have enough documentation to support the losses (thanks to this forum!).

In reading MBJ's article it seems like the makers of Turbotax and the Form 1040 Instructions from the IRS are completely inconsistent with how the W2G's should be handled per the resources cited in the article. You can see from the 7craps screen shots that the Other Income Statement explicitly instructs you to enter "Gambling Winnings from Form W2G". Given my 2016 return experience the IRS really is expecting you to enter them and if you do not expect to get a collections letter from them.
GWAE
GWAE
Joined: Sep 20, 2013
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December 15th, 2018 at 4:16:52 AM permalink
Quote: MichaelBluejay

The above post is exactly why I don't frequent this forum much.



You are annoyed by CMs comment, yet you are ok with your condescending comments made to multiple people?

Yes I did read your article. Yes I did not report w2gs as you say you dont have to and yea the IRS sent me s letter saying that I didnt report them.
Expect the worst and you will never be disappointed. I AM NOT PART OF GWAE RADIO SHOW
AcesAndEights
AcesAndEights
Joined: Jan 5, 2012
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MichaelBluejay
December 15th, 2018 at 4:50:41 AM permalink
Quote: CrystalMath

Congrats on your SAT. I guess those skills donít help you not be a prick.


I have to defend MB here. His article is very comprehensive, and addresses many of the issues people are bringing up here in surprise, even though he posted it at the beginning of the thread.
"So drink gamble eat f***, because one day you will be dust." -ontariodealer
Wizard
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Wizard
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December 15th, 2018 at 6:00:09 AM permalink
Quote: CrystalMath

Congrats on your SAT. I guess those skills donít help you not be a prick.



Oh my goodness. I never thought I would see the day CM got a suspension. Especially for CM, I'm going to make the suspension for pi days.
It's not whether you win or lose; it's whether or not you had a good bet.
Wizard
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Wizard
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odiousgambitMooseton
December 15th, 2018 at 6:37:32 AM permalink
Quote: GWAE

Yes I did not report w2gs as you say you dont have to and yea the IRS sent me s letter saying that I didnt report them.



I have heard many stories like this. If it important to the filer to have a clean looking return that won't get audited, then the sum of "gambling winnings" on line 21 should be equal or greater than the sum of your W2G's. I think many gamblers report exactly this sum and take a deduction in schedule A and I have never heard of anyone getting an audit for gambling winnings who did this. Yes, I know that is not what tax instructions say, but story after story show that the IRS puts a lot of stock into W2G's.

BTW, my total itemized deductions for 2017 was $19,608. The standard deduction for married filers for 2018 is $24,000. That means that 2018 will be the first year I take the standard deduction I believe since I bought my first home in 1992. More importantly, it means I will suffer paying taxes on W2G's. I fall in the 22% tax bracket. If I'm playing a game where only a royal gets a W2G, that will lower the expected return of the game by about 0.44%, which is huge in video poker. When I do play, it is often on multi-play machines that get a W2G on a dealt four of a kind or more too.

Suffice it to say that unless I find a huge play, I am done with video poker.
It's not whether you win or lose; it's whether or not you had a good bet.
darkoz
darkoz
Joined: Dec 22, 2009
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December 15th, 2018 at 6:50:06 AM permalink
Quote: Wizard

I have heard many stories like this. If it important to the filer to have a clean looking return that won't get audited, then the sum of "gambling winnings" on line 21 should be equal or greater than the sum of your W2G's. I think many gamblers report exactly this sum and take a deduction in schedule A and I have never heard of anyone getting an audit for gambling winnings who did this. Yes, I know that is not what tax instructions say, but story after story show that the IRS puts a lot of stock into W2G's.

BTW, my total itemized deductions for 2017 was $19,608. The standard deduction for married filers for 2018 is $24,000. That means that 2018 will be the first year I take the standard deduction I believe since I bought my first home in 1992. More importantly, it means I will suffer paying taxes on W2G's. I fall in the 22% tax bracket. If I'm playing a game where only a royal gets a W2G, that will lower the expected return of the game by about 0.44%, which is huge in video poker. When I do play, it is often on multi-play machines that get a W2G on a dealt four of a kind or more too.

Suffice it to say that unless I find a huge play, I am done with video poker.



Moving on to comp hustling?

You can even keep playing VP
For Whom the bus tolls; The bus tolls for thee
Wizard
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Wizard
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December 15th, 2018 at 6:59:58 AM permalink
Quote: darkoz

Moving on to comp hustling?



I already do some of that. I'm going to have to put in my play other ways than video poker from now on. Ultimate Texas Hold 'Em, I think, is a good choice. I'll split this off to a new thread if the topic seems of interest to others.
It's not whether you win or lose; it's whether or not you had a good bet.
ChumpChange
ChumpChange
Joined: Jun 15, 2018
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December 15th, 2018 at 7:21:06 AM permalink
So playing double or nothing sessions of blackjack with a $5000 buy-in. Double-up and get a CTR written up.
125 sessions of winning $5000 = $625,000 in session wins, and 125 CTRs.
103 sessions of losing $5000 = $515,000 in session losses
Gambling wins of $625,000
Standard deduction of $12,000
Gambling wins after standard deduction: $613,000, 37% tax bracket in 2019.
Gambling losses: $515,000
Net taxable income: $98,000
Tax owed: 37% x $98,000 = $36,260
Paying way more than 50% more tax than if just a net of $98,000.
DRich
DRich
Joined: Jul 6, 2012
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December 15th, 2018 at 7:53:26 AM permalink
Quote: ChumpChange

So playing double or nothing sessions of blackjack with a $5000 buy-in. Double-up and get a CTR written up.
125 sessions of winning $5000 = $625,000 in session wins, and 125 CTRs.
103 sessions of losing $5000 = $515,000 in session losses
Gambling wins of $625,000
Standard deduction of $12,000
Gambling wins after standard deduction: $613,000, 37% tax bracket in 2019.
Gambling losses: $515,000
Net taxable income: $98,000
Tax owed: 37% x $98,000 = $36,260
Paying way more than 50% more tax than if just a net of $98,000.



You should not get a single CTR filed on you for that. Only buy ins or cashouts over $10k get a CTR. Also, CTR's are not reported to the IRS they are filed with FINCEN. Unless FINCEN thought you were a criminal they would not contact the IRS.
Living longer does not always infer +EV
GWAE
GWAE
Joined: Sep 20, 2013
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December 15th, 2018 at 7:59:57 AM permalink
Quote: DRich

You should not get a single CTR filed on you for that. Only buy ins or cashouts over $10k get a CTR. Also, CTR's are not reported to the IRS they are filed with FINCEN. Unless FINCEN thought you were a criminal they would not contact the IRS.



I always wondered if these agencies really dont 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?
Expect the worst and you will never be disappointed. I AM NOT PART OF GWAE RADIO SHOW

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