Do you have to report online poker earnings to the IRS?

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Do you have to report online poker earnings to the IRS?

Postby dogplayer » Mon Nov 17, 2008 12:02 am

Do you have to report online poker earnings to the IRS?
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Re: Do you have to report online poker earnings to the IRS?

Postby xoticgambler » Mon Nov 17, 2008 12:03 am

Unless your TOTAL income is low enough that you are not required to file, you are legally required to report ALL income. Even if you only make $0.01 form a given source, that penny is supposed to be reported. on-line gabling is not legal in the US, but illegal income is taxable. On-line losses are NOT deductible against winnings because illegal expenses are specifically not deductible.
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Re: Do you have to report online poker earnings to the IRS?

Postby grandsalami » Mon Nov 17, 2008 12:05 am

xoticgambler is correct about losses from LEGAL gambling being an itemized deduction against gambling winnings. Losses from ILLEGAL gambling are not deductible. ALL on-line gambling is illegal under US Federal law.
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Re: Do you have to report online poker earnings to the IRS?

Postby blackjackjoe » Fri Nov 21, 2008 11:08 am

How do taxes work for winnings from online poker/gambling sites based outside the US?
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Re: Do you have to report online poker earnings to the IRS?

Postby monkeymonkey » Fri Nov 21, 2008 11:09 am

You may want to contact a tax specialist or CPA, but my understanding is that since online gambling is illegal your only option for taxes is to report it under "other income earned" on a tax form. It's like a catch 22 since it's illegal earnings, but yet the government also wants to tax those illegal earnings. I've heard advice of getting an account with an offshore bank and taking out cash from an ATM so that it's not as tracable if you were audited. You might lose a % with fees and such, but your best bet may be to keep it in cash so there aren't as many paper trails to follow. If you do end up paying taxes on it you would pay in the high bracket like a lottery winner, upwards of 35% I believe.

My advice, if you're really making that kind of money you're either good or lucky. In either case look into a trip to Vegas and keep everything legal so you can enjoy your winnings to the fullest without worrying about the FBI knocking down your door.
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