this may sound stupid but i need legit help

I play video blackjack in florida and signed for over 1 million in jackpots this year, unfortunately everytime you bet 500 a hand and either double or get blackjack it is a taxable jackpot, my win lose statement shows only a small win of 12k but i kept no other records, is there anything I can do or am I going to get slaughtered on taxes

I made a post of this same problem that happened to my friend. He plays slots and had something like several million in wins, as shown by some some tax form. Obviously, he didn't win millions because the forms only report wins, and the forms do not account for losses. What he did was go back to the casino and ask for his full win/loss statement. The casino had full win loss statements because he always used his player card. The casino knew, and was able to provide evidence, of every single penny that he won and lost.

My friend, however, did wind up losing a boat load of cash while going to pick up his win/loss statement. lol.

If you did not use a player's card, then it gets interesting. Did you use a players card?

Good luck, Mr. Warren Jeffs. lol

The above is not legal or accounting advice. And you should be asking an accountant, not us.

I've always heard that win/loss statements are not very reliable, and the IRS knows it. Still, at least you can show something for a net win of only 12K. If you're truly a net loser then the IRS should accept a well-documented log of all your play that year. This is a big topic. It is addressed in much more detail in Tax Help for Gamblers by my accountant, Marissa Chien.

Quote: Wizard

I've always heard that win/loss statements are not very reliable, and the IRS knows it.

That may be true, but it's better than nothing. The instructions on W-2G state:

You can deduct gambling losses as an
itemized deduction, but you cannot deduct more than your
winnings. Keep an accurate record of your winnings and losses,
and be able to prove those amounts with receipts, tickets,
statements, or similar items that you have saved. For additional
information, see Pub. 529, Miscellaneous Deductions, and Pub.
525, Taxable and Nontaxable Income.

I understand that personal gambling journals have been sufficient evidence in audits but it doesn't appear the OP had one. Just one more reason to play craps -- you can't ever get a W2G. Except, I suppose, on the Fire Bet.

Question: I've never been at a table where the top Fire Bet win pays out at 1000 for 1. That hits the IRS threshold, so does the game stop for W-2G forms?

Quote: MathExtremist

Question: I've never been at a table where the top Fire Bet win pays out at 1000 for 1. That hits the IRS threshold, so does the game stop for W-2G forms?

They usually stop for 250-1 and definitely stop for 1000-1. The 250-1 depends on the amount bet and the state's individual rules (i.e. Indiana doesn't require it, but Iowa does). It's usually a fast process, but again, that also depends on the casino.

Yes, W2Gs are issued for the Fire Bet when its more than $1199. Bet $1 and you're paid $1,000 there's no W2G.

If your W2Gs are all from the same casino and you have a detailed win-loss statement, then at least you can make up a gambling journal to show your gambling history. After all, if you are getting a W2G for each gambling session, then you know exactly what days you gambled on. You should also be able to pull whatever records you used to fund your gambling excursions, be it a withdrawal record from a bank, a deposit with the casino, etc.

Your goal is to rebuild your gambling history for last year, and to be smart about it. With a source record of where you got the money from, a detailed Win-Loss form, a made up gambling journal, and a record of deposits into your bank account, you should be able to put together a true reflection of your gambling history from last year.

Good luck.

The best thing is never get involved in games where its possible that your
winnings will be reported. Its a real can of worms to open.

Quote: EvenBob

The best thing is never get involved in games where its possible that your
winnings will be reported. Its a real can of worms to open.

It's one reason I draw back from video poker.

I've never had a jackpot that I had to sign for in any game or in any casino.

I'm told that one of the advantages of the off shore boats is that the winnings take place in Panama and are not reported to the IRS but I've never even understood if that is true or not. Of course for it to be relevant to me I would have to have winnings over and above the cost of the buffet. And not even the slot players seemed to do that well.

Canada's winnings are also tax free on all lotteries and gambling wins.

Quote: jeffwarren75

I play video blackjack in florida and signed for over 1 million in jackpots this year, unfortunately everytime you bet 500 a hand and either double or get blackjack it is a taxable jackpot, my win lose statement shows only a small win of 12k but i kept no other records, is there anything I can do or am I going to get slaughtered on taxes

If you actually won then pay the taxes on the 12k. If you have losses to offset your 12k in winnings, then report them. There's nothing to fear unless you plan to cheat the government out of its share. They hate that.

Be careful about 'making up' a gambling journal, the IRS does this
for a living and they can spot a journal that was made after the
fact. People do this all the, make up journals to pad expense
accounts and such.

Quote: s2dbaker

If you actually won then pay the taxes on the 12k. If you have losses to offset your 12k in winnings, then report them. There's nothing to fear unless you plan to cheat the government out of its share. They hate that.

The IRS really likes to screw with gamblers because most
of them wildly misreport their winnings. They have agents that
just deal with people who report gambling wins and losses
and they've seen every trick in the book. The last thing you
want to get is a forensic asset audit, they're brutal. I know
a guy that got one and he said it was amazing how close they
came to the actual amount he made that year.

The IRS has the same access to information that you have. An audit would be in place if things looked really out of whack. For gambling, I think that the fraud rate is very high and the IRS probably allocates a disproportional amount of auditors to this activity.

At the same time, all accountants, including the IRS would include a reasonability test. They realize that a bunch of small jackpots represents a compulsive gambler who is probably not making much at all. However, the burden of proof is on you. You've got a couple of things going for you:

The W2Gs are all from one casino (not many), and the Win-Loss statement is available that shows you earned only 12K. Despite the fact that you are making up a journal, it would still represent an accurate depiction of your gambling activities for the year. Support that with withdrawals and deposits to your bank account and I think you're probably in good shape, even if the auditors come a knocking.

For what it's worth, I would actually go out and hire an accountant to do your tax return and make them your representative.

I'm up in Canada. My wife operates her own business, but she keeps *terrible* records. Basically, when I put the taxes together, I've got to apply reasonableness to every figure that I put on the tax return. If you are being "reasonable" then you probably won't get audited.

Quote: EvenBob

The IRS really likes to screw with gamblers because most
of them wildly misreport their winnings. They have agents that
just deal with people who report gambling wins and losses
and they've seen every trick in the book. The last thing you
want to get is a forensic asset audit, they're brutal. I know
a guy that got one and he said it was amazing how close they
came to the actual amount he made that year.

Heh. I highly, highly doubt this. I know people who work for the service and they are overworked as it is. The gambling wins/losses is not a big part of their enforcement. Unless it is a major part of your income, they will not look twice. I got $6,000 in W2-G's last year, $4,000 this year. I just cancel them out with losses. It's not going to increase my tax liability one iota either way.

Quote: teddys

Heh. I highly, highly doubt this. I know people who work for the service and they are overworked as it is. The gambling wins/losses is not a big part of their enforcement.

Its a very small part. But the people who handle it
know what they're doing and messing with them is
to be avoided if possible.