Your thoughts on act 165

[AdvantagePlayer]

My friend from Hawaii is going to visit Las Vegas. He is a nonprofessional gambler. The problem is the does not know when to quit. Hawaii passed a law that say "Taxpayers with income from gambling activities will be required to include all winnings in gross income and will not be allowed to offset any of their gambling winnings by theirgambling losses. Under prior law, gambling losses could be used up to the amount of any gambling winnings." What are your thoughts on this act/ law

 

[creeping panther]

Ap

My friend from Hawaii is going to visit Las Vegas. He is a nonprofessional gambler. The problem is the does not know when to quit. Hawaii passed a law that say "Taxpayers with income from gambling activities will be required to include all winnings in gross income and will not be allowed to offset any of their gambling winnings by theirgambling losses. Under prior law, gambling losses could be used up to the amount of any gambling winnings." What are your thoughts on this act/ law

How sweet.

Play no machine that can win 1,199 or more, and only play table games and be sure not to get to the point of a CTR.

Then, report nothing, just say no.

Enough is enough.

CP

 

[QFIT]

He needs to get an accountant with gambling experience.

 

[shadroch]

My friend from Hawaii is going to visit Las Vegas. He is a nonprofessional gambler. The problem is the does not know when to quit. Hawaii passed a law that say "Taxpayers with income from gambling activities will be required to include all winnings in gross income and will not be allowed to offset any of their gambling winnings by theirgambling losses. Under prior law, gambling losses could be used up to the amount of any gambling winnings." What are your thoughts on this act/ law

I wouldn't gamble in Hawaii. Other than that, its no big deal.

 

[aslan]

My friend from Hawaii is going to visit Las Vegas. He is a nonprofessional gambler. The problem is the does not know when to quit. Hawaii passed a law that say "Taxpayers with income from gambling activities will be required to include all winnings in gross income and will not be allowed to offset any of their gambling winnings by theirgambling losses. Under prior law, gambling losses could be used up to the amount of any gambling winnings." What are your thoughts on this act/ law

The danger is that that kind of stupid law could spread. I guess the underlying statement it makes is that gambling is evil and therefore should be taxable, a sin tax, if you will. Or maybe they know the vast majority of gamblers are losers so the state would be losing out on a big chunk of revenue if they allowed an offset. It's a kind of double jeopardy: the gambler loses at the casino and then the state comes along and takes away part of winning side of their overall (net) loss.

 

[shadroch]

Does Hawaii have a state lottery? If not, this is akin to those states that passed laws charging taxes on illegal drug transactions. It's just another charge they'll throw at illegal gambling.

 

[fsscout]

After checking several sites about gambling in Hawaii, I have found that Hawaii has no casinos, lottery, etc. If this isn’t true please let me know. It appears Hawaii is discouraging any of its residents from gambling, anywhere, with this law. Of course I feel this law is unfair.

I know here in Nevada that if you win a jackpot of $1200 or more on a slot machine they fill out a W-2G which reports those winnings to the IRS. I believe that is mandated by the Federal Government and any casino in the nation must adhere to that law.

As far as cashing in chips of $1200 or more at one time I do not know if they fill out a W-2G or not. If your friend has to cash in large amounts of chips, I would suggest he not cash in more than $1,199 at a time to be safe. It wouldn’t hurt to learn the laws regarding W-2G’s and the policy of the state and casino he is gambling in. Maybe somebody can shed some light on this.

creeping panther in a previous quote gives some good advice.

 

[shadroch]

Creeping Panther is encouraging the OP to commit tax fraud, hardly good advice.

 

[Deathclutch]

I agree with just not reporting if they want to make it so unfair. The people that were already evading will continue to do so and the people who used to be honest will defect. The few remaining will have to pick up the slack and be unfairly punished for doing the "correct" thing.

 

[21forme]

Things to consider in how you handle it:
1099s are not submitted to states, only to the IRS (though there may be exceptions).
Some states require a copy of the Federal return as part of the state filing. Others don't.

 

[Automatic Monkey]

My friend from Hawaii is going to visit Las Vegas. He is a nonprofessional gambler. The problem is the does not know when to quit. Hawaii passed a law that say "Taxpayers with income from gambling activities will be required to include all winnings in gross income and will not be allowed to offset any of their gambling winnings by theirgambling losses. Under prior law, gambling losses could be used up to the amount of any gambling winnings." What are your thoughts on this act/ law

One serious problem is the question of defining session boundaries of winning and losing. At the blackjack table every time you win a hand you have winnings. So if I am betting $100 per hand for 100 hands, win 40 hands and lose 60, have I lost $2000 or won $4000 according to this law?

Or suppose I am staying at a casino resort for 2 days, win $5000 on Saturday and lose $6000 on Sunday. Have I lost $1000 or won $5000? When you leave Las Vegas with less money than you came in with no one would consider that "winning", but as this law is written it would appear they think a person who wins money at Bally's and gives it all back at Paris later that day has winnings.

Such a law would put a gambler is the horrible situation of having a winning session, followed by a much worse losing session, and having to remain at the table hoping for another big win so he will have enough money to pay his taxes. If he loses it all, he will be both bankrupt and liable for the taxes on all the money he "won." This is a law that needs to be challenged.

 

[fsscout]

Creeping Panther is encouraging the OP to commit tax fraud, hardly good advice.

I don't think creeping panther is suggesting tax fraud. Nothing illegal about winning small pots when nothing is reported to the IRS, chances are the player lost more than his accumulation of small pots was anyway. It sounds like the player the OP is talking about loses in the long run.

It is a stupid law. Sounds like they want you to keep track and report every time you win a single dollar on a slot machine regardless of how much money you previously pumped in to get that dollar. sahadrock would you do that? Technically if you didn't it would be tax fraud.

I still would like to know that if you cash in $1200 or more in chips at one time if you are given a W-G2. Anybody got the answer to that?

 

[Billy C1]

I don't think creeping panther is suggesting tax fraud. Nothing illegal about winning small pots when nothing is reported to the IRS, chances are the player lost more than his accumulation of small pots was anyway. It sounds like the player the OP is talking about loses in the long run.

It is a stupid law. Sounds like they want you to keep track and report every time you win a single dollar on a slot machine regardless of how much money you previously pumped in to get that dollar. sahadrock would you do that? Technically if you didn't it would be tax fraud.

I still would like to know that if you cash in $1200 or more in chips at one time if you are given a W-G2. Anybody got the answer to that?

The short answer is, it depends on the venue but usually that $1200 figure is based on a onetime win like hitting a jackpot on a machine. Most other vouchers that are over $1200 need not be worried about because it's an "accumulated" win. Same way with the chips.

BillyC1

 

[aslan]

One serious problem is the question of defining session boundaries of winning and losing. At the blackjack table every time you win a hand you have winnings. So if I am betting $100 per hand for 100 hands, win 40 hands and lose 60, have I lost $2000 or won $4000 according to this law?

Or suppose I am staying at a casino resort for 2 days, win $5000 on Saturday and lose $6000 on Sunday. Have I lost $1000 or won $5000? When you leave Las Vegas with less money than you came in with no one would consider that "winning", but as this law is written it would appear they think a person who wins money at Bally's and gives it all back at Paris later that day has winnings.

Such a law would put a gambler is the horrible situation of having a winning session, followed by a much worse losing session, and having to remain at the table hoping for another big win so he will have enough money to pay his taxes. If he loses it all, he will be both bankrupt and liable for the taxes on all the money he "won." This is a law that needs to be challenged.

The law isn't fair. :yikes:

 

[nottooshabby]

I don't think creeping panther is suggesting tax fraud. Nothing illegal about winning small pots when nothing is reported to the IRS, chances are the player lost more than his accumulation of small pots was anyway. It sounds like the player the OP is talking about loses in the long run.

It is a stupid law. Sounds like they want you to keep track and report every time you win a single dollar on a slot machine regardless of how much money you previously pumped in to get that dollar. sahadrock would you do that? Technically if you didn't it would be tax fraud.

I still would like to know that if you cash in $1200 or more in chips at one time if you are given a W-G2. Anybody got the answer to that?

I've done this many times in several different states and have never been given a W-2G.

 

[aslan]

I've done this many times in several different states and have never been given a W-2G.

No, the way the tax law reads, the $1,200 W-2G only applies to slot winnings. You will have to cash in $10,000 or more in chips to get the IRS's attention. Keep trying.

 

[nottooshabby]

No, the way the tax law reads, the $1,200 W-2G only applies to slot winnings. You will have to cash in $10,000 or more in chips to get the IRS's attention. Keep trying.

Keep trying to get the IRS' attention? No thank you!

 

[shadroch]

I don't think creeping panther is suggesting tax fraud. Nothing illegal about winning small pots when nothing is reported to the IRS, chances are the player lost more than his accumulation of small pots was anyway. It sounds like the player the OP is talking about loses in the long run.

It is a stupid law. Sounds like they want you to keep track and report every time you win a single dollar on a slot machine regardless of how much money you previously pumped in to get that dollar. sahadrock would you do that? Technically if you didn't it would be tax fraud.

I still would like to know that if you cash in $1200 or more in chips at one time if you are given a W-G2. Anybody got the answer to that?

Yes, there is everything illegal about not reporting your winnings simply because the IRS wasn't informed.
With all due respect, if you can't answer your question, you really shouldn't be offing advice on a subject you obviously know very little about.

 

[aslan]

Yes, there is everything illegal about not reporting your winnings simply because the IRS wasn't informed.
With all due respect, if you can't answer your question, you really shouldn't be offing advice on a subject you obviously know very little about.

All winnings are subject to taxation whether or not the IRS knows anything about them. I doubt that many individuals declare unknown winnings. I don't know anyone who does. I would imagine the majority of gamblers lose more than they win anyway, making it a moot point for most.

 

[kewljason]

The law isn't fair. :yikes:

I don't think any of us will disagree with this thought. However, just because the law isn't fair, doesn't give us the right to ignore it. And I personally wouldn't advise anyone to break the law on a public forum as CP did, but that's just me.

I am not familiar with the IRS, patroling the message boards, but that doesn't mean they couldn't. And if they chose to, let's see just how anonymous we are with them having the IP address?? The catch a predetor show does it, so why couldn't the IRS?? And the statements made online on a message board seem to hold up and actually make the case for the authorities in that show. So I may be overly cautious, but I would tread lightly. As for me, I like to pay the government every cent I owe them. Just to be on the safe side, I try to error on the side of the government. :laugh: