robtr3
robtr3
Joined: Dec 29, 2010
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November 19th, 2015 at 8:02:55 AM permalink
When playing table games, the casino will issue an IRS Form W-2G in the event of a hit for $600 or more that is also at least 300 times the wager.

My question is: in games with more than one wager made by a given player on a given individual hand, should the winnings for which that form is issued on a given outcome ONLY include those on the bet whose payoff was >$600 and >=300:1, or should the form also reflect (and should the house also withhold taxes, if and where required by law, on) winnings from all bets at that particular position on that hand?

Example (sadly, only a hypothetical): On Ultimate Texas Hold'em, I bet $100 on the ante, $100 on the blind, and $25 on the Trips bet, make a 4x ($400) raise before the flop, and end up with a royal flush. Notwithstanding any posted aggregate payout caps, the winnings on that hand would be 40:1 on the trips bet ($1,000), even money on the ante and raise bets ($100 [if the dealer qualifies] and $400), and 500:1 ($50,000) on the blind bet. The $50k on the blind bet would most certainly be a part of what gets reported on the W-2G for that hand; my question is should the other three bets be paid straight out of the rack and remain uninvolved with the paperwork (meaning the W-2G would only be for $50,000 with taxes withheld accordingly) or would the IRS require the house to include the winnings from those other three bets as well (meaning the W-2G would be for either $51,400 or $51,500, depending on whether the dealer qualified, and taxes withheld based on those figures)? If it's the latter, my next question is: since, in this hypothetical, I have $51,500 in winnings from a hand where a total of $625 was wagered and am therefore being paid aggregate odds of less than 83:1--far less than 300:1, to be sure--should there even be an IRS Form W-2G under the circumstances? (this could also be a valid question in cases where the posted maximum aggregate payout per hand comes into play and reduces my winnings to less than 300:1).
wellwellwell
wellwellwell
Joined: Jun 17, 2015
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November 19th, 2015 at 8:15:48 AM permalink
Each bet stands on its own.

Same as if you make multiple bets at the horse or dog track on one race.

You win the exacta, WPS, and the trifecta. Only the trifecta pays $800 and is 300x the bet so you get a W2G on the trifecta winnings only.
Mission146
Mission146
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November 19th, 2015 at 11:50:58 AM permalink
That's right, but keep in mind that Electronic Table Games are typically handled in the same fashion as Slots. As a result, the threshold increases to $1200, but that would be based on the overall sum won including all bets.
https://wizardofvegas.com/forum/off-topic/gripes/11182-pet-peeves/120/#post815219
MathExtremist
MathExtremist
Joined: Aug 31, 2010
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November 19th, 2015 at 3:06:50 PM permalink
Quote: Mission146

That's right, but keep in mind that Electronic Table Games are typically handled in the same fashion as Slots. As a result, the threshold increases to $1200, but that would be based on the overall sum won including all bets.

That's an interesting point, because ETGs are table games in some state jurisdictions and slot games in others for state taxation purposes. For federal taxation, I wonder if the IRS would insist that an ETG is treated as a table game (lower reporting threshold) even where the state treats it as a slot game. Has anyone ever gotten a W-2G on an electronic table game for an amount between 600 and 1200? If so, in what state?
"In my own case, when it seemed to me after a long illness that death was close at hand, I found no little solace in playing constantly at dice." -- Girolamo Cardano, 1563
waasnoday
waasnoday
Joined: Jan 13, 2015
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November 19th, 2015 at 4:31:07 PM permalink
To the best of my knowledge the IRS W2G reporting requirements consider all electronic video games to be treated the same as slots and winnings from these machines must be reported at the $1200.00 level. The individual states may consider these games to be actual table games but the IRS does not. This could all become moot if the IRS does lower the slot/electronic video game winnings threshold to $600.00.

edit: an is became an if

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