Tax on Jackpots at B&M casinos

[Richtree7]

This subject is nothing new but thought I'd post my thoughts.

Yesterday I won $2,000.00 on a video poker dbl-dbl bonus machine at the Mohegan. I was playing a $1.00 machine and was playing $5.00 per hand. I drew four 4's with a 3 which paid $2,000 and set off the machines jackpot signal. There is then an automatic 25% tax owed to the fed's. Pay it now or pay it later? I always opt to pay immediately because as a confirmed gambling addict I need to pay when I have the cash on hand.

My thought is "the jackpot should be paid based on the wager". If I had been playing a .25 cent machine with 5 quarters in ($1.25) and hit a Royal Flush for $1,000.00 there would be no tax.

I realize the tax is paid on jackpots exceeding $1,199.00 and no govt tax official cares what I think.... but they should probably base a jackpot definition on how much you wagered per hand.

 

[bpb]

The $1,200 threshold for a W-2G has nothing to do with taxes owed. It has to do with reporting the win to the IRS. You owe federal taxes on your gambling winnings regardless. Doesn't matter if you win $12, or $120, or $1,200 or $12,000. And it's not taxed at 25%. It's taxed as standard income, so the rate depends on your annual income for that year.

You can claim losses up to your total winnings as an itemized deduction.

 

[Richtree7]

Yes I realize that but I don't pay taxes on my $10.00 wins or my $1,000 dollar wins...shhh please don't tell.

My point is the 'threshold', as you pointed out, for the casinos to report wins to irs.

bpb, You are correct of course. I just wish to pay taxes on my wins reported by the casino to the irs. The less they are required to report the better for me.

Most of my wins and losses are from the crap tables and the casino's tracking of the money I lose at the table is 'never' accurate on the casino's provided win-loss statement at year-end. Their statement always reflects me losing much less than I do lose at the crap table for the year. In fact my losses far outweigh my wins each year. I guess this is true for frequent casino gamblers everywhere.

Back to my original point: Gamblers that only play quarter video poker machines are less likely to have their winnings reported. I just want the same opportunity to hide my wins if I happen to have a hit on a dollar machine.

This is just a rant and not something that I ever expect to see changed in my favor.

 

[bpb]

Yes I realize that but I don't pay taxes on my $10.00 wins...shhh please don't tell.
My point is the 'threshold' for the casinos to report wins to irs.

The $1,200 threshold is merely meant to create a paper trail on individuals who have a reasonable potential of finishing the year with a significant net win. Whether you created that win with $.05 coins or $5 coins doesn't change that. Someone with a one-wager win of $1,200+ has a significant chance of finishing on the happy side of variance and thus owing the IRS a portion.

I personally wouldn't brag about tax evasion on a forum.

 

[oldtrvlagt]

I personally don't see it as "bragging about tax evasion on a forum" but merely pointing out some of the irregularities of the system. My husband plays dollar slots and in one spin can win a jackpot and have to pay the IRS and state. I, on the other hand, play what you would call "penny slots" but $1.50 to $2.25 per spin. If I get a bonus round and it gives me 200 spins I don't think it should be considered a "jackpot" if I cross over the $1200 threshold unless it is on one spin (not accumulated) but most places in the country it is. I have played at a couple places where it isn't for one reason or another.

My two penny's worth

 

[Richtree7]

bpb

bpb,
Personally I don't care whether you would post anything about tax evasion. Just my opinion (probably others may agree?) but I think you are an insufferable know-it-all. When I look back at many of the posts you make at this forum I see mostly complaints about what other people post.

Some forums have a button to click on which would block me from having to see your posts. Wish this forum had that button.

I personally wouldn't brag about tax evasion on a forum.

 

[Jasminebed]

If you click on a member's name, and then view profile, there is an ignore function at CM.

Frankly, I've never felt the need to use it myself, but some members I read their posts more closely than others.

I think there are few gamblers (excluding poker players, because there is skill as well) that end up ahead for long. If the casino is not tracking your play correctly, I think you need to address that with the casino.

Gambling winnings are not taxable in Canada, but if a Canadian wins money at a US casino we are subject to a withholding, which mostly we get refunded. But the paperwork needs to be done after your return to Canada.

As a side note, there's still a lot of VP machines that pay 1199 coins for a straight flush here, dispite the fact it should be 1200. You actually take a small hit on the RTP if you hit one at max bet.

 

[dionysus]

lol, God bless a tax free country for gambling and lotteries lol eh Jas