Taxes : Who all are Filing as a Professional Gambler ?

[Sam Odom]

Tax issues for professional gamblers

https://www.journalofaccountancy.com/issues/2016/oct/taxes-for-gamblers.html

[ttwarrior1]

if u win over a certain amount, they give u a tax form you have to file no matter who u are

[Foxx]

if u win over a certain amount, they give u a tax form you have to file no matter who u are

That wasn't really the question. Receiving W2G has little to do with whether or not one files as a professional.

[Foxx]

One thing I don't see in the article is that filing as a professional subjects you to the self employment tax for Social Security and Medicare.

[Philmill]

Tax issues for professional gamblers


https://www.journalofaccountancy.com...-gamblers.html

interesting..... Thanks Sam for the read

[jjgold]

Lol

Gamers reporting

[phinfan27615]

One thing I don't see in the article is that filing as a professional subjects you to the self employment tax file Social Security and Medicare.

You get a deduction for half though so it ends up being the same results

[dark star]

Is Broke Landers a Pro?

[ttwarrior1]

what about for everyone, anyone here file their forms or losses

[Foxx]

You get a deduction for half though so it ends up being the same results

Yes you can deduct half of the self employment tax for calculating taxable income for income tax purposes. That's not a tax credit though and the value of the deduction would be the amount of the deduction times your marginal rate. So the effective bite of the 15.3% Self Employment Tax would wind up being 7.65% + 7.65% x (1 - tax rate) so about 13.4% if you are in the 25% bracket. Certainly not the "same result" as not filing as a professional and paying 0% for that tax. Of course, professionals can deduct certain expenses which may or may not offset the self employment tax cost. Filing as a professional gambler no doubt skyrockets your audit risk as well.

[Marco30]

thought that was for state loterries....

[phinfan27615]

Yes you can deduct half of the self employment tax for calculating taxable income for income tax purposes. That's not a tax credit though and the value of the deduction would be the amount of the deduction times your marginal rate. So the effective bite of the 15.3% Self Employment Tax would wind up being 7.65% + 7.65% x (1 - tax rate) so about 13.4% if you are in the 25% bracket. Certainly not the "same result" as not filing as a professional and paying 0% for that tax. Of course, professionals can deduct certain expenses which may or may not offset the self employment tax cost. Filing as a professional gambler no doubt skyrockets your audit risk as well.

you're right, had a brain fart and forgot a "for agi* deduction isn't the same as a tax credit. thanks for clarifying