Lets talk taxes...

[roveer]

I'm in my second year of high denom VP so I tend to produce a lot of W2G's.  Last year when I filed my taxes my accountant warned me that all these W2G's went right on the "front page" of my tax return and counted as earned income.  He said my losses came off deeper in the return after the increased income from the W2G's wiped out several of my standard deductions.   Based on that, is there anything I should be doing differently in the way I file my taxes or is this just how it is?  Many times that I have W2G's my losses during the same trip may wipe out most if not all, and I've even had trips with W2G's that were losing trips.  I've heard something about if you keep records of your win/loss, very detailed records, that you don't necessisarly file your taxes like this and get hosed by losing standard deductions. Can someone shed some light on this, or if there are any good resources, point them out here so I and others can take advantage. Thanks. Roveer 

[BillyJoe]

Welcome to my world, Roveer.



 
I am retired, on fixed income, but since I do a bit of gaming during the year, those W2Gs make me look like those dreaded "1% " folks. Our lovely tax system measures 'wealth' by your AGI, which is where those W2Gs land before any losses are considered. I have had ALL my medical and other legitimate deductions wiped out for years as a result.


 
I have heard that you can declare yourself a 'pro', and while the W2Gs are still income, you can "net" down differently. I, personally, have never looked that much into approaching it that way.
 
I would definitely be interested in any other responses to this as well.

[roveer]

Ahhh...  So I am not alone...  This should be interesting. 

[shadowman]

Well, there's this book that might help:
 
http://www.amazon.com/Tax-Help-Gamblers ... 0929712536
 
However, in general I think you're SOL. I've had my medical deductions reduced for many years. It can also hit other things as well. Also, if you try to file as a "pro" there are certain requirements (like showing you are truly trying to win). As such, if you played any negative return games you would probably not qualify after an audit and end up paying penalties and interest.

[Buffilita]

Roveer, I'm assuming you're using a player's card each time you're on a machine.  You should be able to get a win/loss statement from your casino(s) based on the tracking through your player's card.
 
I know that all Caesar's Entertainment casinos are combined into one win/loss statement which is easily accessible online.  Presumably, other loyalty programs provide them too.  I keep my W2Gs for backup, but file tax returns based on win/loss statements.
 
Good luck and keep winning! 

[BillyJoe]

If there is no Congressional action to extend the current tax rates into 2013, I may have to switch to playing table games. I shutter to think of the taxes on an inflated AGI next year, with all the deductions reduced, so I would have to ditch the W2Gs.

[hijack]

I know how you all feel as I was in the same boat last year with w2s.    This year I got smart and stopped playing the 1$ 9-6 jacks or better.   Now I only play 25 cent J or B and I don’t have any w2s.   This works for me.

[BillyJoe]

Roveer, I'm assuming you're using a player's card each time you're on a machine.  You should be able to get a win/loss statement from your casino(s) based on the tracking through your player's card.
 
I know that all Caesar's Entertainment casinos are combined into one win/loss statement which is easily accessible online.  Presumably, other loyalty programs provide them too.  I keep my W2Gs for backup, but file tax returns based on win/loss statements.
 
Good luck and keep winning! 
But Buff, you need to include ALL your W2Gs, at a minimum, as "other income" on your Federal tax return. You cannot 'net out' your wins for the year, based on the casino Win/Lose statements, and only declare the balance as "other income".
 
I wish that were so. It would be a lot fairer for everyone.  

[roveer]

Does anyone have the casino take federal withholding on their jackpots? Seems like a way to force some savings?

[marie meijer]

I always have the MI taxes taken out at time of jackpot/W2G hand pay, since they have to be paid in full. Do not always trust the person handling your hand pay to have the correct info, but it does not hurt to ask what most others do, when they win. Consistently, they say most have the state taxes taken out of that hand pay, but not the federal. Call it forced savings if you wish. At least it's that much less to have stolen as I leave casino and head for home. The federal can be written off with losses. I keep one calendar just for keeping daily track of casino play. To date, no audit. I have always heard there is no statute of limitations where fraud for IRS is concerned. I have also heard that the last three years is usually the time of question. If you have been audited and gamble, your input here would be appreciated including the time span of your records they require. Also, could it be handled by mail or did you have to appear in person?Friends who declared mom as a dependent could count on being audited every year.