Need Help, Taxes, Getting Busted??

vanman · 10-21-07, 04:28 AM

First off welcome to the forum and congrats on the little girl.
If you have a full time job then any money you make gambling online shouldn`t be liable to tax as you do not rely on it solely for your income.

thewarrior · 10-21-07, 04:54 AM

Thanks.

So as long as I have a full time job I wont pay taxes on it.

Im from the U.S., thought we had to pay taxes on everything whether it be $1 extra a month or $1000 extra?

vanman · 10-21-07, 05:01 AM

Do you have to pay tax when you place a bet or is betting tax free the same as in the UK.?

Justin7 · 10-21-07, 08:40 AM

warrior,

By law, gambling winnings are taxable. If you itemize, you can deduct your losses up to the amount of your wins. Unlike stock losses, gambling losses don't carry forward year to year.

The more you make, the more you should focus on being "legit". If you earn 50k in a year from gambling and don't report it, you're at the cutoff where the IRS starts trying to make a case for tax fraud.

jjgold · 10-21-07, 09:00 AM

that is peanuts guy, no worries

your small time so they do not care

secondly you can also use a fake SS #

thewarrior · 10-21-07, 11:27 AM

Can someone explain how you pay taxes on your winnings? DO you simply deposit them in your at home bank and thats its, your clear or what else needs to be done?

Cyclone · 10-21-07, 11:31 AM

Paying the tax is easy. You report the amount you made on the first page of the 1040, I think under "Other Income". You can also deduct your losses, up to the amount of winnings. (In other words, the government is not going to support your gambling habit). That, I think, is on Schedule A.

curious · 10-21-07, 11:37 AM

Don't risk getting into a beef with the IRS over something this trivial. Keep very accurate records. Make print outs of all your wager tickets. Keep your deposit receipts. Make these deposits by themselves even if you have to go to the bank twice in one day.

At the end of the year if you have net winnings just put them on your return. Keep your records for ten years in case you get audited.

Peace of mind in dealing with the thugs at the IRS is worth more than the money involved.

thewarrior · 10-21-07, 11:44 AM

I guess what Im worried about is, living in the U.S. basically all online gambling is illegal. So how can you list that your gambling on your tax returns when your not supposed to be doing it in the first place?

curious · 10-21-07, 11:47 AM

Originally posted by thewarrior

I guess what Im worried about is, living in the U.S. basically all online gambling is illegal. So how can you list that your gambling on your tax returns when your not supposed to be doing it in the first place?

<sigh> It isn't illegal for you to place an online bet. It is illegal for the online sportsbook to take your bet, and it is illegal for them to transfer money from/to you.

What size bets do you make? How big is your bankroll? Unless you are a dime player I doubt this is going to make any difference anyway.

thewarrior · 10-21-07, 11:56 AM

None the less I would still like to know. Just for my own curiosity: If I made 24k in winnings what do I do to stay good with the gov. even though its technically illegal?

Cyclone · 10-21-07, 11:58 AM

What he is saying, is that you would get into a lot more trouble for cheating on your taxes, versus participating in an activity like Internet gambling. You are not going to prison for gambling, but you could easily go for taxes.

WileOut · 10-21-07, 12:05 PM

warrier gambling in the USA is not illegal. It is illegal for the sportsbook to take bets, it is not illegal for a person to place a bet.

jon13009 · 10-21-07, 12:18 PM

I would report it if the gambling income is significant.

I would look here:

http://www.gambling-law-us.com/Articles-Notes/good-questions.htm

GL

thewarrior · 10-21-07, 12:46 PM

would setting up a Swiss bank account and then withdrawing funds using an ATM be illegal?

It's just I looked at the Income Tax gambling forms and you have to tell everything, the type of wager, where and when you placed the bet and with who? lots of info going out

jon13009 · 10-21-07, 12:50 PM

If you need to do that, you have something to hide. (personal, financial or legal)

Let's be clear about this, if you are hiding significant gambling funds from the IRS, laundering money through a on-line book, or using an online book to run your own bookie service, you are playing with serious heat.

See a tax attorney, if your are concerned and legit. Otherwise setting up a Swiss bank account sounds a bit too extreme to me because you have other issues to worry about.

GL.

thewarrior · 10-21-07, 12:57 PM

Do you know of any websites that offer a # to call so I could get in contact with a tax attorney?

jon13009 · 10-21-07, 01:01 PM

Not anyone personally,

But start here (two gambling sites started by lawyers - email them)

http://www.gamblingandthelaw.com/

http://www.gambling-law-us.com/

The Feds are not after the small time on-line player.
Look up your local/state gambling laws at the sites listed above, and see where you stand regarding state law.

Otherwise, look in your local phone book and ask around for a tax attorney who specializes in gambling matters.

GL.

curious · 10-21-07, 01:51 PM

Originally posted by thewarrior

would setting up a Swiss bank account and then withdrawing funds using an ATM be illegal?

It's just I looked at the Income Tax gambling forms and you have to tell everything, the type of wager, where and when you placed the bet and with who? lots of info going out

Geesh. Now you want to go from illegal gambling to tax evasion to money laundering to wire fraud to conspiracy.

You aren't going to open a Swiss bank account. But, if you did win significant money, and you tried some stupidity like this and the IRS did get on to you for some reason, then not only would you now be guilty of tax evasion, but about a dozen more serious crimes as well.

In dealing with the IRS I have seen that not giving them anything to be suspicious about is almost as important as what you actually did/didn't do.

If you deposited your winnings in your own account and for some reason you were audited and for some reason the IRS auditor got your bank records and for some reason questioned those deposits...you could probably get away with professing ignorance. It is one thing to have your tax liability increased by an audit. It is another thing entirely for the IRS auditor to suspect that you went to great lengths to hide income.

Like I said, keep accurate records, put the money in your own account, if you win pay taxes, if you lose listen to your wife complain and get over it.

WileOut · 10-21-07, 04:07 PM

Originally posted by WileOut

warrier gambling in the USA is not illegal. It is illegal for the sportsbook to take bets, it is not illegal for a person to place a bet.

I just want to clarify this a bit. The laws differ depending what state you live in. There is no federal law against placing a bet. Some states have laws against placing a sports bet, and they range from misdemeanor to felony.

When I say it is illegal for a bookie to take bets, I am talking about those based in the USA. Like your local bookie.

As for the offshore books, I don't know if it is legal for them or not. If you ask me, they are taking bets in a country where it is legal to accept bets so the US should stay the **** out of their business. But thats just my opinion.

HedgeHog · 10-21-07, 05:41 PM

If you're that worried about it, declare the income. Just make sure to subtract your losses and other expenses against it, so you don't screw yourself. While illegal to intentionally not report any income whatsoever, including that $100 bill you once found, there is virtually no paper trail for someone winning $1000 or so per month. The Books you use are not reporting your info to the US government, and the Bank you're using won't put up any red flags unless the checks you're depositing are in the five figure range consistently. The only way "small-timers" (not meant to be a rip) get caught is by bragging to others that they're underreporting or by starting a thread like this to bring unnecessary attention to the matter. I suspect you know the right answer, but you're looking for permission to get away with not reporting the winnings. You're on your own--- as are the rest of us.

Willie Bee · 10-21-07, 05:52 PM

Originally posted by jjgold

secondly you can also use a fake SS #

Yes, by all means, raise a second red flag

There are only two pieces of advice I'm going to give you, Warrior -- 1) Don't take JJ too seriously, and; 2) If you do get on a serious winning streak where you need to start worrying about all of the money you're making, please post your plays here. Thank you

HedgeHog · 10-21-07, 06:48 PM

Originally posted by Willie Bee

Yes, by all means, raise a second red flag

There are only two pieces of advice I'm going to give you, Warrior -- 1) Don't take JJ too seriously, and; 2) If you do get on a serious winning streak where you need to start worrying about all of the money you're making, please post your plays here. Thank you

What book asks for a SSN? Banks do, and you'd be a fool to supply false info to them, considering the ramifications. JJ thinks he's getting paid per post, double if he starts the thread. His opinion is worthless, and in this case dangerous if you follow it.

thezbar · 11-19-07, 07:18 AM

Warrior I've had tax issues from gambling winnings several times over the years. I doubt a $900 check is going to be questioned by the irs. I wouldn't be to concerned if this is a one time deal. If you continue to score I suggest you keep some sort of records so you can balance the winnings with loses. Horse racing programs with losing tickets attached is one way of doing it. I would try to keep the fact that off shore activity was involved as low key as possible.How you handle this is an individual choice, I am just suggesting you be prepared.
I won a blackjack tournament {$1000} one year and didn't report it as income. Six months later I was paying back taxes plus penalty and interest on it. The IRS does catch these type of things. THe edge you have in this situation is that an off score business isn't goinng to report anything to the IRS.g.l.

Starbuckibm · 11-19-07, 09:30 AM

Originally posted by jjgold

that is peanuts guy, no worries

your small time so they do not care

secondly you can also use a fake SS #

Warrior....clearly ignore this dipshit.

fathead · 11-19-07, 11:57 AM

If you live in the US you owe taxes on gambling winnings. Report all money won on 1040 "other income". Subtract all losses (up to the amount won) on Schedule A "gambling losses". Keep a detailed betting diary with all bets, wins, losses in case you get audited.

You are required by IRS regulations to do this even if you have a losing year. Sometimes the extra "other income" will push you into a higher tax bracket. Unfair, but that is the way it is currently. It hurts to have a losing year and end up paying more taxes.

It is illegal for the IRS to turn you in to law enforcement based on anything reported on your tax return so don't worry about that.

BigBollocks · 11-19-07, 12:02 PM

Warrior, your chances of getting "busted" for not reporting an additional $24K are literally just about nil. I've spoken with countless professionals about the US gaming tax situation, and continue to have discussions from time to time about the US legislation as it stands right now. To say you're extremely small potatoes to the US government would be an understatement. GL...

durito · 11-19-07, 12:19 PM

Pay your taxes and you are fine.

The IRS is not the police, all they want is their money. Why do you think they give out ITIN #'s to undocumented workers. They don't care what you are doing if you pay.