Gambling log for tax purposes

I have been doing some research on gambling and taxes and am somewhat in need of help. As we are just entering 2013, I am preparing to keep track of all of my wins and losses and basically keep every receipt I get, I will have everything logged and filed and ready for next years tax season. I read the thread on here:

and it helped somewhat. Here is my scenario...

I do "work part time", and as far as taxes go for that, I have a solid understanding. What is new is the w2g and logging my gambling wins/losses... I play poker "semi-professionally" and am amping my play up much more this year (including travel to LV, AC, etc...) I log every session within an app on my iphone called Poker Journal.

It logs the following: start date, start time, end date, end time, break time, play time, game (stake, limit type, & game), location (casino), bankroll, initial buy-in, rebuy count, rebuy total, tokes(given to dealer(s)), tips (for cocktails, drinks, food, etc), cashed out amount, net profit, gross profit, net hourly rate, and even players.

So this is the software I use to log my play, it is pretty solid and has basically everything I need. I even thought I can possibly add a custom field and put the dealer that is in the box when I sit down (possibly with their gaming badge number) and the dealer that is there when I leave, and/or the cashier that cashes me out.

I think I have everything that IRS requires for a gambling log. (According to page 12 of IRS publication 529)

When I play poker tournamets, I get a buy-in receipt and when I lose I have that for my records, and when I win, they also give a recepit of winnings. So for tournaments I am not too worried. The poker room supervisor will usually sign and another casino employee will also sign and both verify the payouts along with their gaming badge numbers. I think that is enough for providing a "witness" sort of speak, if I dont have the payout recepit of winning, I have the buy-in receipt to report that tournament a loss.

What my question is how this "honor system" works for "table games" as when I play poker at a live cash game, this is considered a table game and no one really keeps track of wins/losses other than the player (if they choose to). This app I uses has an export function so I can convert everything to Excel and/or other like programs. So is this information I log suffeciant enough? How would anyone know if I just made up my own wins/losses? I just want to make sure that its legit enough that when I file in 2014 that the IRS will accept my logs and we can be square. I obviously don't want anything to back fire on me as I do belive I play enough poker that I don't want to end up being audited or have someone come after me for tax evision.

Any input would help and is appreicated. TIA!

The key is to be consistent, with everything you do. As long as your logs are consistent, anything that meets the minimum requirements is acceptable; even self recorded notes. Head on over to PortableApps.com and download the portable version of Red Notebook.
http://portableapps.com/apps/office/rednotebook_portable

Then, develop a "diary template" that you can use to track each of your gaming sessions. In addition to the required accounting information, I also record gaming conditions, notes, etc. This way, I am encouraged to use the program for more than just keeping track of wins/losses.

Thanks GH. I definitely will keep consistent! That's basically what Poker Journal does. I paid $15 for it but it was worth every penny. It has custom fields that I can add so I also keep track of playing conditions and make notes and what not. The players section is intentionally for keeping notes on players. How they play, etc... I thought it could be useful as well for taxes if I need to record people present.

GH, do you play poker or just use the red notebook for other gaming expense? I only ask because I don't do any other gambling other than poker. So I recommend poker journal for the poker player. Otherwise I would probably use another notebook type app for logging my activity. Thanks for your input!

Also, does anyone else know if I can ask the casino for a CTR or are they only necessary when the casino issues them?

I do mostly BJ and VP. The VP helps, because I can monitor prospective tables that are nearby.

I use Red Notebook, because it lets be keep track of everything I can imagine. All I do is create templates for:
* BJ sessions.
* VP sessions.
* No play "exploratory" expeditions to casinos.
* General "junk" you'd find in any AP notebook/diary.

Technically, You could deduct the $15 as a tax preparation expense ;)

CTR are filed by casinos with the IRS. If you check to website of most casinos, they have online win/loss statement requests. These are useful to ensure that your log is consistent with anything they reported via CTR. And remember, CTR are only required for certain dollar transaction levels.

Will a casino withhold anything for taxes on a table game win in the US? If so how much do you need to win and how much will they withhold? When is it done, at the table or when you cash chips at the cage?

I have never heard of taxes being withheld on table games. They do ask if you have any outstanding markers though

The IRS requires we all report every dollar we win at gambling. I'm sure people who win at table games comply....

I play some vp, and my log only includes date, place, any w2g's received, and amount won or lost at the casino regardless if or how many tax slips I've collected. I do not, however, in any year ever claim I've won more than I've lost, even though there have been some years that I've actually won. I've been audited once and they accepted my doctored up log. Easy peasy.

The question asked was if casinos in the US withhold table game winnings. My answer was that I have never heard of a casino in the US withholding, or issuing W2G, when you tried to cash out chips from a table game. But, you as a player are responsible for logging and self reporting the income.

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Quote: Ibeatyouraces

I've been told on numerous occasions that W2G's for table games are issues on wins of 300-1 or more AND the win pays more than $5000.

I regularly cash more than $5k in chips and have never been asked who the hell I am, LOL. Just because I cash chips at the cashier, doesn't mean I won anything.

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Quote: Aussie

Will a casino withhold anything for taxes on a table game win in the US? If so how much do you need to win and how much will they withhold? When is it done, at the table or when you cash chips at the cage?

I interpret the question being asked as: If you cash $8k of cheques at the cashier, will they only give you back $6k, and *withhold* $2k for the IRS? The answer is ***NO***, you get all $8k.

Quote: Ibeatyouraces

It has to be a single win and pay 300-1 or more, not an accumulated one.

What do you mean by "300-1?"

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It means that they will withhold your winnings at the table game at the spot if your are paid more than 300x your bet. For example, if you get the straight flush jackpot in Caribbean, or the Royal Flush in Let it Ride, you will be subject to withholding tax on the spot.

That doesn't apply to Blackjack, Craps, or any games where there is a payoff of less than 300:1.

I don't keep a gambling log for tax purposes -- I live in Canada, where gambling winnings are tax free.

Quote: Ibeatyouraces

Payoff odds. As in UTH on the blind the royal flush pays 500-1. Hit this with a $25 bet and you'll get a W2G.

But, do they withhold any of the winnings as estimated taxes? I only do BJ, btw.

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Yes, they withhold winnings at the prescribed rate (28% I think) for wins greater than 300:1

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Quote: GH

If you check to website of most casinos, they have online win/loss statement requests. These are useful to ensure that your log is consistent with anything they reported via CTR. And remember, CTR are only required for certain dollar transaction levels.

These logs are notoriously inaccurate - they depend totally on the whim of the pit boss watching your game when you play, and accurately reporting your buy in and color-up. Do you really trust that to be accurate for tax purposes? I've checked a few times and it was so far off from my personal log (which I trust way more, even WITH the amount of alcohol I tend to consume while playing craps) that I don't even bother checking it any more.

Quote: AcesAndEights

These logs are notoriously inaccurate - they depend totally on the whim of the pit boss watching your game when you play, and accurately reporting your buy in and color-up. Do you really trust that to be accurate for tax purposes? I've checked a few times and it was so far off from my personal log (which I trust way more, even WITH the amount of alcohol I tend to consume while playing craps) that I don't even bother checking it any more.

Oh, I absolutely trust my logs more than anything. But you should still at least see what other people are saying about you; just in case it ever comes to your word against theirs :)

Federal withholding on a W-2G is optional if you provide a social security number. If you do not have or do not wish to give one, withholding is not optional. States that have income taxes may or may not require withholding. For example, Missouri casinos will hold 4% for you for state tax purposes.

From IRS W2G - Instructions:

Report gambling winnings on Form W-2G if:
1. The winnings (not reduced by the wager) are $1,200 or more from a bingo game or slot machine,
2. The winnings (reduced by the wager) are $1,500 or more from a keno game,
3. The winnings (reduced by the wager or buy-in) are more than $5,000 from a poker tournament,
4. The winnings (except winnings from bingo, slot machines, keno, and poker tournaments) reduced, at the option of the payer, by the wager are:
a. $600 or more, and
b. At least 300 times the amount of the wager, or
5. The winnings are subject to federal income tax withholding (either regular gambling withholding or backup withholding).

Withholding
There are two types of withholding on gambling winnings:
(a) regular gambling withholding at 25% (33.33% for certain noncash payments) and (b) backup withholding at 28%. If a payment is already subject to regular gambling withholding, it is not subject to backup withholding.

Regular Gambling Withholding
You may be required to withhold 25% of gambling winnings for federal income tax. This is referred to as regular gambling withholding. Withhold at the 25% rate if the winnings minus the wager are more than $5,000 and are from: Sweepstakes, Wagering pools, Lotteries, or Other wagering transactions if the winnings are at least 300 times the amount wagered...

Do not withhold at the 25% rate on winnings from bingo, keno, slot machines, or any other wagering transaction if the winnings are $5,000 or less. However, see Backup Withholding later...

Backup Withholding
You may be required to withhold 28% of gambling winnings (including winnings from bingo, keno, slot machines, and poker tournaments) for federal income tax. This is referred to as backup withholding. You should backup withhold if:

The winner does not furnish a correct taxpayer identification number (TIN), 25% has not been withheld, and the winnings are at least $600 and at least 300 times the wager (or the winnings are at least $1,200 from bingo or slot machines or $1,500 from keno or more than $5,000 from a poker tournament).

Figure any backup withholding on the total amount of the winnings reduced, at the option of the payer, by the amount wagered. This means the total amount, not just the payments in excess of $600, $1,200, $1,500, or $5,000, is subject to backup withholding.

Boymimbo, thanks. That helps clear a few things up.

I'm hoping Wizard chimes in and maybe can give some feedback as far as cash games go.

Thanks for all this acknowledgments and discussion, I've learned and gained a lot! 😁

Bump?

I think it ruins the joy if you need to take time logging your gambling and check all the numbers. But if you can log "invisibly" so that you don't have to look at the numbers all the time, maybe it's ok. Then it's cool to make the summary at end of the year.

Quote: Fuengirola2

I think it ruins the joy if you need to take time logging your gambling and check all the numbers. But if you can log "invisibly" so that you don't have to look at the numbers all the time, maybe it's ok. Then it's cool to make the summary at end of the year.

But isn't that what separates professional sports players from amateurs? The collection of all kinds of statistics and logs? Not that there should be a professional BJ league, but the analogy is applicable.

On this topic, I just started reading Tax Help for Gamblers. I just finished the first chapter so can't comment on its usefulness as of yet.