video poker EV after taxes

  • bobstaman

    video poker EV after taxes

    If you were to play FPDW with a 100.7% return how do the taxes on the royal flushes effect your EV. I cannot seem to understand if taxes put you in -EV or just takes a percentage of your winnings. My problem is that if you tax just the royal flush it lowers the value of the royal flush which could make the game -EV. But if you were to tax your net winnings it would only be taking a portion of your winnings still putting you in +EV. This is probably a simple problem, but i can’t seem to come up with the answer.

  • mjbballar23

     

    The answer is it depends. Best option is to talk to a CPA and let them address your situation. In the mean time, its probably best to stick to $.25 denomination so you aren’t generating W2-Gs.

  • ms069279

     

    Quote: mjbballar23 said:
    The answer is it depends. Best option is to talk to a CPA and let them address your situation. In the mean time, its probably best to stick to $.25 denomination so you aren’t generating W2-Gs.

    X2!!

    However, Bobstaman, you need to remember that the 100.7% EV gathered from FPDW is derived mostly from the Royal, as most paytables are top-heavy. Needless to say that the majority of your FPDW sessions will not incur a RF and therefore, the EV will not be affected by taxes.

    Another thing that needs to be considered, in the event that you do hit the RF at some point, is how you file your taxes. As a professional gambler, you may either declare “EVERY SINGLE” loss on the “Schedule C” OR declare all losses “UP TO” the amount of your taxable income as a non pro but rather, a recreational player.

    (ie. 1 W2G at $1 FPDW = $4000 in losses allowed to be declared).

    I would also recommend reading “Tax Help for Gamblers”, by Jean Scott, the Queen of Comps. A very valuable book for all intense and purposes.

    Hope this helps!!

  • moo321

     

    I believe this is covered in beyond counting.

    It’s a good question, because taxes make FPDW not worth it.

  • mjbballar23

     

    considering that FPDW is only found in $.25 or less these days, taxes aren’t relevant.

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