Report online winnings or avoid?

[soundlanguage]

Hi all. Being new here (and greenhorn online BJ player) I wonder about the more experienced players thoughts on reporting winnings and how earnings are monitored, if they are. I've heard/read much about p/t workers who are making a fair amount off modest winnings but wondered how they report this income (if they choose to). I've prowled around online for the usual answers but am curious what this messageboard's regulars have to say about it...

It seems to me it's like being self-employed in any field of work where what you wish to reveal on the tax form is up to you... does anyone bother being that honest by reporting them as their primary income and paying taxes on it? Is there a threshold where you go beyond a hobbie level & must report it or "they" come a knockin'?

Online wise, I assume the obviously large gains will attract notice but what about multiple smaller winnings equaling the same amount? paying taxes on it? What are the pro's & con's overall?

A stable job offers more security or face-to-face social interaction but for what might be the income (weekly/monthly/annually overall) or just wanting a little extra income why not choose BJ betting/playing? I've had conversations with friends who frown upon it but it seems money is money and aren't games of chance/skill/luck as good as a PT or even FT 9-5 office job as long as you're disciplined, non-obsessed and somewhat talented?

Thanks in advance for your info/thoughts. Cheers

 

[Liquid Chips]

It is up to you if you want to report your profits or not. But if the online casino or any other entity reports your winnings/earnings to the "Eye R S" then you are better off reporting it yourself too. Myself don't volunteer information.

 

[KenSmith]

Call me crazy, but I've always reported everything, online and land-based. I file as a professional gambler, and pay tax on my actual net gambling income each year.

One thing to consider about online profits. They produce a paper trail as the funds move out of your accounts and back in.

 

[soundlanguage]

Call me crazy, but I've always reported everything, online and land-based. I file as a professional gambler, and pay tax on my actual net gambling income each year.

One thing to consider about online profits. They produce a paper trail as the funds move out of your accounts and back in.

Thanks for that, I figured consistant (read: FT players) BJ pro's think of it like a job and pay taxes accordingly, and of course the paper trail makes an undeniable good angel on your shoulder nudging you into reporting. For beginners I wonder if it's worth the trouble though if winnings dont amount to a substancial sum, say over 5 or 10k or so, which wouldn't replace your annual wages.

What % do you find is sucked away from your overall net?
10-15% or more? If it's unreasonably proportioned (compared to straight job) as many self-employed filers have said it seems an audit :whip: is still likely.

Double whammy! :cry:

 

[NDN21]

Reporting....

Correct me if I am wrong but aren't most online casino based offshore? That is because online gambling is not legal in the US but it's sort of like Al Bundy says "it's only cheating if you get caught". The authorities have yet to pursue an in-depth investigation into online gambling. It has grown unchecked in the US. Online gambling is in violation of the Interstate Wire Act. Just because no one has been prosecuted doesn't make online gambling legal.

So if I am correct and I believe I am then that would make any online gambling (if that's what you are into) one might do illegal. You don't report income from illegal activities. So don't report income from online casino's.

 

[Mikeaber]

Correct me if I am wrong but aren't most online casino based offshore? That is because online gambling is not legal in the US but it's sort of like Al Bundy says "it's only cheating if you get caught". The authorities have yet to pursue an in-depth investigation into online gambling. It has grown unchecked in the US. Online gambling is in violation of the Interstate Wire Act. Just because no one has been prosecuted doesn't make online gambling legal.

So if I am correct and I believe I am then that would make any online gambling (if that's what you are into) one might do illegal. You don't report income from illegal activities. So don't report income from online casino's.

The fact that the online gambling in your opinion is illegal, does not detract one iota from the IRS's requirement that you pay taxes on it. Illegal income to the IRS from illegal means is just as succeptible to tax as legal income. Ask the "moonshiners" from the 30's about it :laugh: Tax evasion is the hook they hung them on.

 

[Liquid Chips]

I'm thinking of the quote: It's better to ask for forgiveness than to ask for permission. It's application to reporting online winnings is up to you.

 

[aussiecounter]

"What online winnings Mr Taxman?"

Bugger that, I'm not paying 45c/$ or whatever tax bracket I'm in (the highest I think). Besides, I don't think that we get taxed on winnings, hehehe.

 

[NDN21]

winnings

I forgot about the fact that the only thing they ever got Al Capone on was tax evasion, nothing from his other criminal ways. So you are correct in that income gained from illegal activities is just as taxable as income from legal activities. I guess that's why some states have the "Marijuana Stamps" tax that is completely laughable.

But you are wrong about the issue of online gambling being illegal "in my opinion". Online gambling is illegal and in violation of the Wire Act I mentioned. No doubts as to the legality of it at all. I even asked my Law instructor about it and he said "yes it is illegal but I'll ask my partners for their opinion". He came back the next day and said "yes, it is illegal and they backed me up". But the gov't isn't doing anything about it and I doubt they would unless they catch you in the act.

If it were legal then why are all the online casino's offshore (at least everyone I can think of is offshore) in other words away from the US where US authorities have no jurisdiction to prosecute the online casino's. If it were legal then why aren't there any in the US?

I still have serious questions about off-shore online casino that has no or little regulations. They could be just flat-out cheating players who play at them.

 

[nightfoxx]

oneline casino's

i'm not sure but isn't the main reason that these online casino's are based offshore because if they were in the US they would have to pay for expensive gaming lisences like b & m casino's do?

nightfoxx