(2 votes, average: 3.00 out of 5)
Loading...
Any money you win while playing games is almost always taxable income. This comprises not only cash but the fair market value of the prizes, such as cars or trips. In theory, you must report any winning, even if it’s as little as $10. You are technically supposed to report that winning in your tax declaration, in addition to your job income; together, these form your total income.
Special rules apply to the income from games; to round up, a standard deduction of federal income tax of 25% applies to any winnings over $600. At the end of the tax year, all such income needs to be declared.
It is not only at casinos where you can win money and other prizes; a wide variety of other activities still offer you such awards:
The prizes you can get don’t just consist of cash; a nice dinner at a fancy restaurant can also be valued at a certain amount of cash. It’s good to know the real price of your prizes, so you can state it in the tax forms.
IRS requires you to report if you win the following amounts (or more) at the following games:
| Poker tournament | $5,000 or more |
| Keno | $1,500 or more |
| Slot machine/Bingo | $1,200 or more |
| Horse track | $600 or more (whenever this is 300 times the amount you bet) |
When you are lucky enough to win these sums of money, then in order to receive your prize, you need to provide the payer with your Social Security number and fill out your W2-G form for the IRS, which means, to report your winnings. In most cases, the casino deducts 25% directly off the sum you have won. Note that some table games (roulette, blackjack, baccarat, and craps) do not require the W2-G; it means that the casino doesn’t issue the form, but you are to report the winnings and pay the taxes on your own. The reason why this happens is simply that when you play table games, the casino cannot calculate with any certainty what your initial bet was.
We have some good news for you now! You can deduct your gambling losses, which means that if you itemize your deductions, you may claim your gambling losses up to the amount that doesn’t exceed your winnings. If you claim to have significantly more losses than winnings, this can also attract an IRS audit. Any excess losses can’t get transformed into a tax write-off.
So, you need to keep a record of your losses, and not just your winnings. If you become a member of a casino club, you can easily track of any winnings and losses made while using your player card.
In some states, a special taxation system is applied to the gambling income separately from the IRS federal taxes. In some states, there is no gambling tax at all; some have unique formulas and rules to calculate the taxes either based on the number of your winnings, or simply by applying a flat rate percentage to be charged. In some states, it’s necessary for you to claim the earnings from gambling in the state they were won, but the majority of states tax all the income gained in a particular state without taking into account your residency.
If gambling is your profession, then you need to record your professional income and expenses on Schedule C. Such earnings from professional gamblers are considered regular income and are taxed at the normal effective income tax rate. In such a case, you can include lodging, meals, and tickets into your expenditure.
You can write a diary where you state all your expenditure from playing games. The IRS asks you to keep exact information about each gambling activity associated with each win or loss; you need to have the date, name of gambling activity and name and address of the casino or event, names of other clients present at the time of the activity, and of course, the amounts of money won and all losses. If you become a casino club member, you can ask the casino to send the record of all your activities with precise information about your total winnings and losses.
Gambling winnings are always taxable. By law, you must report all your income from lotteries, casinos, raffles, slot machines, card games, and races. This includes not only cash prizes, but also the fair market value of prizes like cars, tickets for trips, and other things.
There are several ways to minimize your taxes. To name but a few, you can: report your losses as well as winnings; if gambling is your profession, you can state your losses as your professional expenditure; withhold some money for the day of paying taxes; reselling merchandise at a reasonable price; ask the casino for assistance; try to minimize the market value of the item you won by checking the real value of it, because in some cases the organizers can overstate the value for promotional purposes.
The amount you can cash out at the casino is $600. When you win a total of $600 in various games or your winning was made during several days, the casino is not obliged to give you a Tax Form (W-2G). That means you need to fill the form in on your tax day. If you win $600 and more, you must pay your taxes immediately and receive your net income only. The online casinos usually pay your cash without deductions; you have to pay the taxes on your own.
If you don’t report your gambling winnings, you will end up attracting the attention of the IRS (Internal Revenue Service), in the form of an audit. Honesty is the best policy, so you are obliged to always report any of your winnings above the figure of $600. Another thing that could possibly trigger an audit is high losses; especially ones that are larger than your actual winnings.
Normally casinos don’t track your wins with the purpose of reporting them to the IRS; but they do keep track of them for their own statistics. When you use your player’s card, they know how much you have won or lost previously, as well as how much time you have spent playing.
In Chinese Macau and Hong Kong, the Pacific typhoon, Manghut, which came from the Philippines, was incredibly destructive. At the local airport, about 1000 flights were canceled. Also, the railway connections were paralyzed too, which meant that almost 500 people were stranded at the railway stations.Related Posts Man Punches Slot Machine at Hard Rock Casino, […]
Michael Boettcher, the owner of one of the erstwhile largest Russian gambling companies – Storm International, – told in his interview for Vedomosti newspaper how he lost all his gaming assets in a single day and suffered huge losses as a result of closing down his business in Russia. In 2008, at the time of […]
Most players associate Baccarat with games of pure chance. This may be why some people really enjoy playing it, especially when they have a chance to enjoy touring a slew of real casinos in Vegas. Yet, other players don’t like this game because they can’t influence its gameplay using the player’s decisions. And if you […]
In this article, we are going to explore the best video games with in-built gambling features (except for the phenomenon of loot boxes, considered by many to be another form of gambling). Online gambling has made a step forward and introduced some elements of chance to video games. In-built gambling is not the main subject […]
On Monday September 14, MGM announced that it plans to open its first smoke-free casino at the end of September, when Park MGM will finally reopen its venues to players and tourists. The resort comprises around 2,990 rooms and various restaurants, and it’s set to be reopened on September 30. The venue has been closed […]
Online gambling has undoubtedly taken a place of true supremacy over the casino industry during the pandemic. And the reason for that is quite clear: online casinos are more accessible, and you can always count on some encouragement from the casino administration to help you boost your game. However, this digital revolution has only been […]
The large selection of online gambling sites out there can make players somewhat puzzled, and give them a feeling of uncertainty about making the right choice of casino. Each online gambling venue offers its own conditions, games, and various bonuses, of course; but the most important thing is the reliability of the casino and the […]
To be or not to be? This question is bothering thousands of players out there, who are all busy contemplating their playing strategies. “Should I bet more?” Or, “is it all about luck?” These are just some of the many questions that have been bothering people who are keen on casino games; and quite honestly, […]
