How much can a person win in a casino without paying taxes?

[Raincity]

Allot of mis information in this thread.

Slot single win jackpot or Bingo winning $1200 = W-2G
Live Keno win $1500 = W-2G
Poker Tourny winnings $5000 after buy in = W-2G
Table Games winnings and sports tickets of $600 and excess if the payout excess of 300-1 = W-2G

All cash transactions of $3000 or more are recorded. If you exceed $10,001 within 24 hours. You will be required to sign a Currency Transaction Report to continue gambling.

 

[Fayd]

Well, I could be wrong, but I think it is considered capital gains, and everyone is SUPPOSED to have any and all gambling winnings on their taxes each year (though I doubt anyone does). So when someone makes a big amount, the casino "helps" them by having them fill out paperwork. The thing that bothers me about that is, say the magic amount is $5000. What if the gambler started off with $4000? How can the casino prove that it is all winnings?

because it's called "capital gains"... IE, the amount over and above what you started with.

 

[QueBert]

My friend won $8k in Morongo's Poker room. he was paranoid they were going to tax him. So when we left the Poker room he cashed out smaller amounts at various stations every 30 minutes until we left about 3 hours later. I'm sure people monitoring the video saw this. But nobody said shit to him.

 

[manlymatt83]

$10000, but you can offset current year losses.

 

[Mike Gayner]

because, you know, it's not like it's income that might be subject to a tax on income.

Windfalls aren't income as far as the NZ government is concerned. That includes casino winnings, sports betting, horses and lottery winnings.

 

[Ms. DICKINSON]

Depends on you income. I've won 4000$ and there's no mention of taxes.

 

[KMFJD]

Windfalls aren't income as far as the NZ government is concerned. That includes casino winnings, sports betting, horses and lottery winnings.

I believe Canada is the same, you can also include financial gifts from family as well...not taxed at all.

 

[spidey07]

If the payout odds are greater than 300-1 then you will need to provide identification and normally SS card. Casino or track reports it to IRS and you get a W2-G. You are supposed to pay taxes on ALL gambling profit. It is treated as short term capital gains and is taxed the same as wages.

You can however deduct gambling LOSS to avoid paying taxes as long as you can prove it. I get a profit/loss statement from the racetrack and save all my tickets so when I do have big hits I can prove my net gain is zero. My TVG.com and xpressbet accounts are the same. They will give you the money, but you'll get a W2-G which means the IRS knows about it.

If you however sit at a blackjack table and rake up 30K you won't have a W2-G generated or need to show ID since the max odds are so low.

I've hit a few big ones at a casino over in IN. They take state income taxes out of it ON THE SPOT.

 

[guyver01]

nobody wins at a casino.

even if you "win" .. you still lose.


but... to answer the question, here in colorado, the IRS requires casinos to hold back 30 percent from anyone who wins $1,200 at a slot machine or $600 at any other game unless the winner fills out IRS form W2-G.

 

[spidey07]

nobody wins at a casino.

even if you "win" .. you still lose.


but... to answer the question, here in colorado, the IRS requires casinos to hold back 30 percent from anyone who wins $1,200 at a slot machine or $600 at any other game unless the winner fills out IRS form W2-G.

I'm net positive gain almost every single year. I know, I have to keep track of it all for tax purposes.

 

[CPA]

Wow, this thread.

Technically, ALL gambling winnings are taxed as ordinary income.

However you may offset winnings with losses, IF you itemize. Losses are subject to a 2% of AGI floor, and losses can not exceed winnings. In other words, you can not show a net gambling loss on your 1040.

Also, you don't receive a 1099, you should be receiving a W-2G. Here is an excerpt from the rules regarding issuance of a W-2G:

The payer must furnish a Form W-2G to you if you
receive:
1. $1,200 or more in gambling winnings from bingo or slot
machines;
2. $1,500 or more in proceeds (the amount of winnings minus
the amount of the wager) from keno;
3. More than $5,000 in winnings (reduced by the wager or
buy-in) from a poker tournament;
4. $600 or more in gambling winnings (except winnings from
bingo, keno, slot machines, and poker tournaments) and the
payout is at least 300 times the amount of the wager; or
5. Any other gambling winnings subject to federal income tax
withholding.

Point 4 is the one that probably pertains to most folks and it contains the 300 times amount of wager criteria. So, even if you won $10000, but your wager was a $100, the casino does not have to issue anything, but that doesn't mean it's not reportable.

The withholding at the casino, if it happens, is 25%.

 

[Paladin3]

because, you know, it's not like it's income that might be subject to a tax on income.

I'm probably confusing logic with our U.S. tax code, but if winnings are considered income and taxed, then why shouldn't every cent you wager be considered a business expense?

 

[spidey07]

The withholding at the casino, if it happens, is 25%.

Good info. I have never had anything withed at a casino other than state taxes. And I don't think they are withholding it, they are taking it in that instance. Sign this W2-G (or whatever form it is, they seem to be different depending on state), put your social on it and address, here's your money. A few weeks later or sometimes at the end of the year you receive an official FORM W2-G stating gain.

 

[mugs]

I'm probably confusing logic with our U.S. tax code, but if winnings are considered income and taxed, then why shouldn't every cent you wager be considered a business expense?

Who said it was business income?

You can deduct the full amount that you wagered (even on separate occasions); you only pay tax on your gambling profit for the year. If you win $5000 playing poker but lose $6000 on slots, you don't pay any tax on your winnings.

Windfalls aren't income as far as the NZ government is concerned. That includes casino winnings, sports betting, horses and lottery winnings.

Don't you see how either way of dealing with gambling income is arbitrary? You can't say it "should" or "shouldn't" be taxed unless you can make a logical argument for or against it.

 

[CPA]

Good info. I have never had anything withed at a casino other than state taxes. And I don't think they are withholding it, they are taking it in that instance. Sign this W2-G (or whatever form it is, they seem to be different depending on state), put your social on it and address, here's your money. A few weeks later or sometimes at the end of the year you receive an official FORM W2-G stating gain.

W-2G is a federal form so everyone should be complying, however, some probably do it better than others. Also, 25% is only the Fed rate. In fact, a good rule of thumb is that any non-regular wage and non-capital gain is considered "special earnings" by the IRS and therefore is immediately taxed at 25%. What the effective rate is, of course, determined by your individual filing.

 

[IHateMyJob2004]

In CT, I'm pretty sure that anything over $10K in winnings requires that you fill out paper work for hte IRS at the casino.

 

[din46]

I know it's been a long time since I started this thread, but I finally got an answer. I was at the Tropicana in Atlantic City a week or so ago, and hit a jackpot on one pull for $2000. A lady came over and turned off the bell on the machine, asked me some info, and said she would be back with my money. She brought back a form to fill out, which the casino will send to the IRS so I can pay taxes on my winnings. I asked her what the limit was, so a winner didn't have to fill out the form, and she told me it is $1200. She pointed out several machines where the top jackpot was $1199, she said that people like playing these machines, because if they hit the jackpot, they know they won't have to fill out the form. She also told me that this only counts on a single jackpot, in other words you could hit two smaller jackpots for $1000 each, totalling $2000, and you don't have to fill out the form.

Another thing she told me was, you can contact the casino at the end of the year, and if you use one of their cards in the machines you are playing, they track your winnings and losses, so they can send you your stats showing exactly how much you've put into the machines over the past year. If you've lost more than you've won, you don't have to pay taxes on your winnings. I think for most people, this would be the case.

In the casino, yes you can win up to $1,199.99 at once cash out without filling out any IRS form. You can win as many times as long as under $1,200 each of winning. When you file income tax, you can claim the lost if only you have any wining. If you lost $2000 and you win $500, you can claim the lost only $500. If you win $2000 and you lost $500, you can claim wining $1500 .
But when you win lotto under $600, no IRS form is needed to fill out.

So many people playing machines in the casino, they cash out anytime they win under $1000, then they put the money again (instead you put back the ticket) in the same machine to play it again..

 

[din46]

In CT, I'm pretty sure that anything over $10K in winnings requires that you fill out paper work for hte IRS at the casino.

Table game is differed than machines. Most casinos when you cash out the chips under $10K is no IRS form requires to fill out. In CT is Indian reservation casino, I thought no tax form is needed to fill out. Indian don't pay income tax.

 

[mwtgg]

Well, I could be wrong, but I think it is considered capital gains, and everyone is SUPPOSED to have any and all gambling winnings on their taxes each year (though I doubt anyone does). So when someone makes a big amount, the casino "helps" them by having them fill out paperwork. The thing that bothers me about that is, say the magic amount is $5000. What if the gambler started off with $4000? How can the casino prove that it is all winnings?

That's already been tried before. It didn't work then, it won't work now.

 

[din46]

W-2G is a federal form so everyone should be complying, however, some probably do it better than others. Also, 25% is only the Fed rate. In fact, a good rule of thumb is that any non-regular wage and non-capital gain is considered "special earnings" by the IRS and therefore is immediately taxed at 25%. What the effective rate is, of course, determined by your individual filing.

If you win lotto, the state will HOLD 25% for fed tax, but also some state will hold another about 8% for state tax. So if you win state lotto, you might receive about 67% of winning, after tax withholding.
In Las Vegas, there are casino machines everywhere in grocery stores, even in 7-Eleven stores. If you win some big money in the machine, they pay you cash for total wining, but they fill out IRS form for you. If you don't have any ID with you, they will NOT pay you. But you can ask your friend to claim the winning on his/her name and with his/her ID. They will have to claim the winning on their income tax. You have to decide how much you have to give your friend for income holding tax, of course no less than their tax bracket.

 

[Hacp]

Wow, this thread.

Technically, ALL gambling winnings are taxed as ordinary income.

So every time you win, you need to pay taxes, but you can't deduct when you lose unless you itemize. Win a game, pay taxes on it. Lose a game, you still paid taxes on your winning hand. Great.

 

[DCal430]

At one of the Indian casinos in San Diego, the magic number is $10,000 for table games. I know of a guy who won $180K one year, but didn't have to pay taxes on that...'cause he lost $200K that same year.

Tax wining and losses do not cancel each other out like that. He still should have reported his winnings and it should have had some impact on his taxes.

 

[akshatp]

In CT, I'm pretty sure that anything over $10K in winnings requires that you fill out paper work for hte IRS at the casino.

Not true. I recently took Mohegan for over 20k, and used a few of my friends that were there to help me cash the chips at different cashiers. Im sure its tracked via my player card, but I could have easily lost that at random roulette tables without producing my card.

 

[Meghan54]

Tax wining and losses do not cancel each other out like that. He still should have reported his winnings and it should have had some impact on his taxes.

Damn son, are you dense? Losses can be claimed to offset winnings up to the amount you've won. But, you can only claim as much in losses as you've had in winnings. If you're a perennial loser, you've lost that and can only claim as much of that as the amount you've won....essentially coming out with a zero on the whole shebang.

Cruise back up to post #7. Explains it pretty well......you claim winnings and can offset winnings with claiming losses, up to the amount of the winnings. You cannot just claim losses, though.

 

[spidey07]

Tax wining and losses do not cancel each other out like that. He still should have reported his winnings and it should have had some impact on his taxes.

Absolutely and incredibly wrong. You can win 10 grand but if you can prove you lost 10 grand you pay exactly zero tax on the 10 grand (unless the state takes a cut). You've never had to deal with this, have you?