[vpFREE] Re: 1099's

Jan: I assume your case with the $4K win on machine B also gave you back a $900. ticket. If that the case then I would agree with what you said. Please note though, I would also mention prominently on an attachment that this session included a W2G for $4,000. Remember IRS's computer tracks W2G's. Since the W2G is not listed on the main form it can kick you out for an audit in which case you tell them to see the attachment which the computer doesn't look at. If you played one day the entire year they probably will tell you you should have listed the $4,000 as winnings and deducted the $2,900 as a schecdule A deduction. Depending on other income for the year, this can hurt you because of the reduced value of your deductions or the Alternative minimum tax or both. I will put in my disclaimer that this is just my opinion as I am not an EA or CPA nor do I intend to be either.
There is later post by Jean Scott on this site. Whlie several other books exist, the Gambling tax book by Ms. Scott and Marissa Chien is the best and most current book addressing your question. Not only do I have a copy, but I gave another copy to my CPA accountant. I stongly urge you to read this book. DEnny

--- In vpFREE@yahoogroups.com, "Jan Spornhauer" <janspornhauer@...> wrote:
>
> Denny, thanks for the information. I am trying to use 6:00 a. m. to 6:00 a.
> m. as time period. To make sure that I understand, I perceive that you
> report session income as follows: You play V/P let's say for 8 hours
> beginning at 9:00 a. m. on two machines. Machine A - Cash in $ 2000 - TITO
> = 0 Loss $ 2,000. Machine B Cash in $ 1,000 - TITO = $ !00 , $ 4,000 W2G
> Hand Pay. Session win = $ 1,100 (4,000 - 2,000 - 900). If this was your only
> gambling for year, you would report $ 1,100 as other income on 1040. There
> would be no gambling losses reported. You may use different terminology but
> is the session win calculation correct and the way you report your gambling
> income.
>
>
>
> Thanks
>
>
>
> Jan
>
>
>
>
>
> _____
>
> From: vpFREE@yahoogroups.com [mailto:vpFREE@yahoogroups.com] On Behalf Of
> denflo60
> Sent: Tuesday, February 09, 2010 9:42 PM
> To: vpFREE@yahoogroups.com
> Subject: [vpFREE] Re: 1099's
>
>
>
>
>
> Jan: Since I started filing as a recreational gambler some years ago I used
> the session method and was never audited. I reported based on the session
> length of a day because of the "churn" of the machines. To me the bigger
> question is the precise definition of a session.
> When I started betting significant money and filed as a professional with
> schedule C, I continued using the session method. Given that the Casino
> supplies the total of my accrued W2G's, I have used the daily session method
> because it agrees with the W2G submission. I do have complete contemporary
> records of all $1200.+ wins from the attachments of the Casino W2's which
> can be tied back through time of day of the "hit" to my records. I survived
> the 2006 audit about using Scedule C but what never directly asked about
> session method or length. As I have reported here and you responded I have
> faced the same issues for the 2007 year and I, my accountant and my lawyer
> will fill out paper work to to request the matter be taken to tax court.
> Whether the session method or session length comes up at that time I do not
> know, we are prepared to defend it and its length. Of course whether I win
> or lose will be not known for some lengthy period. Denny
>
> --- In vpFREE@yahoogroups. <mailto:vpFREE%40yahoogroups.com> com, "Jan
> Spornhauer" <janspornhauer@> wrote:
> >
> > I would like to know of anyone has tried to use daily session win VS using
> > the W2G as income. It seems to me this is a more fair way to report
> gambling
> > income but maybe the IRS doesn't look at it that way. Unfortunately, a
> > taxpayer who has any substantial W2G receipts and has equal losses is in
> the
> > end paying more income tax.
> >
> >
> >
> > The Gambler
> >
> > _____
> >
> > From: vpFREE@yahoogroups. <mailto:vpFREE%40yahoogroups.com> com
> [mailto:vpFREE@yahoogroups. <mailto:vpFREE%40yahoogroups.com> com] On Behalf
> Of
> > tsaimitch
> > Sent: Tuesday, February 09, 2010 1:51 PM
> > To: vpFREE@yahoogroups. <mailto:vpFREE%40yahoogroups.com> com
> > Subject: [vpFREE] Re: 1099's
> >
> >
> >
> >
> >
> > You can deduct losses on Schedule A, or file as a professional gambler
> with
> > Schedule C.
> > Might be able to use "Session wins" rather than 1099s as you wins, but I
> > hear conflicting info on this board.
> >
> > See http://groups. <http://groups.
> <http://groups.yahoo.com/group/vpFREE/message/104962>
> yahoo.com/group/vpFREE/message/104962>
> > yahoo.com/group/vpFREE/message/104962 for some problems with Schedule C.
> >
> > http://www.readybet <http://www.readybet
> <http://www.readybetgo.com/book-reviews/review-606.html>
> go.com/book-reviews/review-606.html>
> > go.com/book-reviews/review-606.html
> >
> > How To Turn Poker Playing Into a Business (Knowing What to Deduct to
> Improve
> > Your Odds With the IRS) by Ann-Margaret Johnston (122 pages, paperbound,
> > $19.95) and The Tax Guide for Gamblers by Roger and Yolanda Roche -- Sixth
> > Edition (64 pages, paperbound, $29.95). Both are excellent references and
> > both are available at Gambler's Book Shop in Las Vegas.
> >
> > http://www.casinoga <http://www.casinoga
> <http://www.casinogaming.com/features/taxlaws.html>
> ming.com/features/taxlaws.html>
> > ming.com/features/taxlaws.html
> >
> > All winnings from all forms of gambling are taxable and must be declared
> as
> > income on your tax return.
> >
> > All losses from all forms of gambling are deductible as an itemized
> > deduction for recreational players, limited to the amount of winnings
> > declared.
> >
> > Professional gamblers hold file as a self-employed business using Schedule
> > C.
> >
> > The value of "comps" received are considered to be gaming winnings and
> > should be included in your total winnings. This does allow you to deduct
> > gaming losses to offset the income from the "comps."
> >
> > Wins and losses are reported only in the year they occur. Excess losses
> > cannot be carried forward or back to offset winnings in other years.
> >
> > Married couples filing a joint return must combine their winnings and
> > combine their losses, and report only one figure for each.
> >
> > The IRS has issued instructions that "lumping" is unacceptable. "Lumping"
> is
> > the practice of reporting one net win figure and no losses, or reporting
> > nothing if your net from gambling is a loss. You must report the total of
> > your winning sessions separately from the total of your losing sessions.
> >
> > The IRS requires that an accurate diary or similar record must be
> maintained
> > for substantiating your wins and losses, and that the diary should contain
> > at least the following information: (1) the date and type of your specific
> > wager; (2) the name of the gaming establishment; (3) the address or
> location
> > of the gaming establishment; (4) the names of the other person(s), if any,
> > present with you; (5) the amount(s) you won or lost.
> >
> > The IRS also requires that in order to substantiate your diary,
> supplemental
> > records are required, including the following (these records are not to be
> > submitted with your return, but will be needed should you be audited): (1)
> > W-2Gs; (2) wagering tickets or receipts; (3) canceled checks; (4) credit
> > card records such as cash advances; (5) bank withdrawals; (6) any receipts
> > provided by the gambling establishment.
> >
> > KEEP RECORDS OF YOUR GAMBLING TRANSACTIONS
> >
> > In February of 1998, in a case involving an unemployed gambler who failed
> to
> > file timely returns for two years and kept no records, the Tax Court ruled
> > that the gambler could not deduct unsubstantiated gambling losses. In
> > addition the Tax Court upheld the IRS which had levied additional amounts
> > for failure to file on time and for the accuracy-related negligence
> penalty.
> > This increased the gambler's tax liability by 43%!
> >
> > In other words, they threw the book at this gambler, who actually told the
> > court that although he maintained a gambling log for one of the years in
> > question, it was not accurate because it was too time-consuming to make it
> > precise.
> >
> > If you are collecting W2-Gs and not keeping accurate records, this very
> well
> > could be in your future.
> >
> > <many more details on the webpage>
> >
> > http://www.irs. <http://www.irs. <http://www.irs.gov/taxtopics/tc419.html>
> gov/taxtopics/tc419.html>
> > gov/taxtopics/tc419.html
> >
> > You may deduct gambling losses only if you itemize deductions. Claim your
> > gambling losses as a miscellaneous deduction that is not subject to the 2%
> > limit on Form 1040, Schedule A (PDF). However, the amount of losses you
> > deduct may not be more than the amount of gambling income reported on your
> > return. It is important to keep an accurate diary or similar record of
> your
> > gambling winnings and losses. To deduct your losses, you must be able to
> > provide receipts, tickets, statements or other records that show the
> amount
> > of both your winnings and losses. Refer to Publication 529, Miscellaneous
> > Deductions, for more information.
> >
> >
> >
> >
> >
> > [Non-text portions of this message have been removed]
> >
>
>
>
>
>
> [Non-text portions of this message have been removed]
>

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