Quote:
Originally Posted by w8n4win
The problem here is, if you had a win and did not file it on your Income Tax. Your tax return for that year is where you would have had the opportunity to file your losses against the gain. The IRS is not going to say "oh okay, in 2005 you won $5000 that you did not claim, but you lost $5000, so we're cool go ahead and go home". They are going to say you didn't claim the income. You have three years to amend a return, but I don't think you can do it once you are being audited. I am wondering if the safest thing to do would be to go back and amend returns.
|
Even worse, the system is set up for phantom income. The IRS doesn't like you to net your wins and losses. So they want all the income on Form 1040. And gambling losses as an itemized deduction on Schedule A. If you didn't have enough to itemize, you end up with phatom gains.
Even worse, they don't like to allow losses even on schedule A. They want a diary that gives detail of time and place and have even wanted table numbers for live play.
The potential for abuse of players is pretty large.
I wonder if going back and amending returns might not be the best bet also. Even returns from closed years because think about how the IRS measures income - gross wins. Include phantom income, and they can allege a large understatement.
We need to get Neteller to tell us what is going on. If this is like Paypal, all this speculation may be for nothing. And it should be.
Stanford.