Home » LAW »» Tax Law

gambling winnings? (Tax Law)

Comments (6) | Promote | Bookmark |

• Leave a Comment Now.
• Comments
• Thu, 14 Dec 2000 12:13:00 GMT(1)
• Gross income is all income not excluded from the tax. There is no exclusion for gambling winnings, and the cases and rulings have consistently held such winnings taxable. The only disputes in the area are on what losses can be deducted from winnings.
  
• Thu, 07 Dec 2000 15:44:00 GMT(2)
• Better act fast as the year is ending quickly. I am not an attorney and not a CPA. Your FIL might look into a charitable trust. The IRS does not like these a whole lot because they are perfectly legal, but they are a LOT of work to maintain. They are great for people who are rather loaded and getting on in years because the money avoids (mostly) the estate tax penalty. Another option that he might have is some sort of IRA contribution that would MINIMALLY offset the taxable income. . .there are age and income requirements for those.
  I would highly reccommend that he go to a CPA. . they are VERY creative about avoiding taxes, lawyers only usually know the LEGAL aspects of what you can and cannot do.
  He CAN claim gambling losses only equal to or less than his gambling winnings. There is a gift of $10,000 per person per year that is not taxable to either party, but I do not know the specifics of it. . .ask a CPA.
  BTW, I have been to those boats and I didn't win 1MIL!
  If you are close to Dayton, OH my father is a very creative CPA. His name is Bill Winkler and his number is (937)847-7811. . .just incase you are interested He will work with out of state also. Regardless of whether you call my dad, I think that a private practice CPA would give you the best advice. . .not a franchise CPA, someone who has a small business practice.
  Sorry such a long reply.
  Valerie
  
• Wed, 06 Dec 2000 13:02:00 GMT(3)
• Because it would be a loophole to paying tax on the winnings. Loopholes are not intended to be a part of any law. Since people, including those that write law, are not perfect, loopholes exist.
  Do you have any records to show the amount of money spent this year on gambling before hitting the jackpot. Money spent can be deducted against the total earnings.
• Fri, 15 Dec 2000 11:11:00 GMT(4)
• How are gambling winnings converter to Income?
  You state cases and rulings....now I am sure there are some, but look at this.
  U.S. Supreme Court in Flint v. Stone Tracy Co., 220 US 107, defined excises as "...taxes laid upon the manufacture, sale, or consumption of commoditios within the country, upon licenses to pursue certain occupations, and upon corporate privileges."
  Are saying that the Income Tax laid upon gambling winnings are indirect?
• Tue, 12 Dec 2000 14:44:00 GMT(5)
• I am not disagreeing with the other answers, merely clarifying a point. The $10,000 exclusion is an exclusion from gift tax. It has nothing to do with income tax. All it means is that you can give a gift of $10,000 ($20,000 if you are married and your wife joins in the gift) without having to pay gift tax.
  As soon as your father won the money, he became liable for income tax on it. Your tax planning possiblities do not inlcude somehow making that amount non-taxabe. However, as it was pointed out to you, you can make charitable contributions and get a deduction.
  It seems like a good idea in his case to consult a CPA for tax planning fast.
  
• Wed, 13 Dec 2000 19:11:00 GMT(6)
• Chapter 35, Section 4401 of the IRS code deals with Taxes on Wagering. It states "Each person who is engaged in the business of accepting wagers shall be liable for and pashall pay the tax under this subchapter on all wagers placed with him." Person "A" placed a bet with business "B". Business "B" is liable for the tax. You opted for a lump sum, which business "B" got "paid" on. State authorized wagers are imposed 0.25 percent of the amount of such wager. The amount of the wager is ...'all charges incident to the placing of such wager shall be included..." So what does all this mean? Lets say you placed a $100 bet to get a million. That $100 is the wager, of which 0.25% or $25 is the tax that business "B" is liable for. You win! The pot is one million dollars of which business "B" is liable for $25. Hopfully, business "B" has acquired enough money from all the money wagered, so he can give it to you. Again you opted for a lump sum....You got approx $500,000....where did the rest of the money go? Business "B" got "paid".
  Now to the other point...what is left, you say you are liable to pay Income Tax on. What the IRS tries to do is turn this into Compensation or Wages. At the time of you winning this, did you work for them? If not, the how are you liable to pay any Income Tax on those winnings (not earnings). Some might say it is a prize or an award, therefore included under Gross Income, but think again. On the Price is Right, you play a game..you invest nothing but time, you win a car...a prize..you owe a tax. You put forth X amount for the chance to receive X amount...you win..how do you owe?
  I am open minded enough to know I may be wrong about this. So, I ask this... If this person has to pay taxes on their winnings, how are the winnings converted to fall under the definition of Gross Income, in order to be taxed as such?
• Leave a Comment Now.

Tax Law Open Questions

I won $1500 on a slot machine during a visit to a gambling boat out of state. I have a state tax form from the casino stating the anmount I won and showing how much was retained by the casino for the state taxes (Louisianna). I have no records, but I lost about $1300 during the visit via......

What is the name of your state? IL I'm a resident of Illinois and won a ~$4600 jackpot last year at a casino in Indiana. I'm filing my state tax returns this year. Indiana withheld $160 for state taxes. My Indiana return gave me a $4 refund. Now I'm filing my Illinois taxes on Illinois Free......

What is the name of your state? IL I'm in the process of a potential buyout and was wondering if anyone could give me any insight to the capital gain ramifications. 1. I'm selling shares in a small C Corporation. The sale will be for 1 million and my basis is 300k. I don't qualify for the 1/2......

What is the name of your state? New York I owned & lived in a condo for 5 years, got married & purchased a new home which we have lived in for the past 3 years. I kept the condo as a rental property because the RE market was sluggish 3 yrs ago. Now the market is great (yeah!) and I can......

<HTML> <HEAD> <META NAME="GENERATOR" Content="Microsoft DHTML Editing Control"> <TITLE></TITLE> </HEAD> <BODY> <P>Bonjour, mon nom est George. Depuis plus d'1 an je gagne plus de 4000/Mois sur internet et cela grce un guide que......

Hello All I am non-resident and had to use Itemized Deductions for IRS Form 1040NR just claiming Georgia State withheld taxes. Could you please help me with next questions? 1) Must I use Itemized Deduction for Georgia Return (Form 500, Schedule 3, Line 10) as I already use Itemized Deduction for......

I work for a General Contractor that has employees that reside in various states across the US. We have an employee that is stating he is exempt from GA state taxes becuase he is a non-resident. The state he is a resident in has no state taxes thus he feels none should be held. I've see companies......

What is the name of your state?GA As a part year resident of GA, I would like to know if moving expenses from federal form 1040, line 29, adjusted gross income, can be listed as adjustments to income on schedule 3, line 6, Computation Of Georgia Taxable Income For Part-Year Residents And......

I am wondering if anyone knows what the state law is for statute of limitations on collection of Georgia State Taxes. Someone is trying to collect two fifa judgements against me which are now 8 years old and 9 years old respectively. Any thoughts on how to fight this? Thanks, Mike...

Some questions maybe you're interest in...

[Traffic Law] What is the name of your state?In Manhattan, NY State: i got this traffic ticket, and the field where the cop's supposed to print his name(Complainant's Full Name (printed)) doesn't have his name, it just has some scribbles. and its not his signature cause that is right above the scribble in.........

[Immigration Law] Good day. I would like to know if it is possible for me to reenter US after being deported for a drug felony? I finished drug treatment program. After that the judje still gave me a prison sentence and I went in to SHOCK facility which I also finished. After completing SHOCK I was transfered to.........

[Intellectual Property] My question involves business law in the state of: Florida The name I wanted to use for my new business came up in a search as a registered trademark in the US. I checked the status at the US Patent Office, etc. & the trademark status is "Dead" as of a couple of months ago. Can I.........

[Employment & Labor Law] State is Texas Someone who works for the same company I do, came with his brother into a restaurant where I was having lunch with a friend who used to be a customer of the company. He sat two tables away and eavesdropped on our conversation. It wasn't until we had finished eating that he let us.........

[Additional Legal Subjects] Back from Africa, where I was a secular missionary in the Kayon Ghozi's leprosary (Burundi) because of health reasons, I wrote these lucky Flashes of mine, which got a resounding success ,on Turin's HOLY SHROUD. Prof. Harry Gove,which made the Holy Shroud date back to the middle-ages in 1988 by.........

[Accidents & Personal Injury Law] i am from georgia. i had a bad rotator cuff tear at work that needed open surgery. i went to one doc. who sent me back to work on modified duty. my employer said tuff and said to do my job so i tried. i rehurt my shoulder 2 days later and had to have the surgery. can i sue for my employer making.........

[Real Estate & Property Law] This question concerns property located in Texas. I recently had an offer accepted on a foreclosed property. I asked that the seller pay for some of my closing costs. They agreed if I agreed to use their bank for my FHA financing. The FHA appraiser went out to the property and came back with a.........

[Insurance Law] What is the name of your state? Illinois When my ex-husband and I divorced -- the judge said that my "X" was responsibile for the uncovered medical and dental bills. The dentist that I toolk the children too was not apart of the insurance plan and will not cover the bill. After several.........

[Family Law] What is the name of your state? California - I have 2 daughters from my previous marriage. A 16 year old stepdaughter who I raised since she was 18 months, and a 12 year old natural child. The 16 year olds bio father is Danish and lives in Denmark. He has made no attempts in 16 years to see our.........

[Traffic Law] I went to my county website (lancaster county, Nebraska) and looked up records on myself. I went throught he traffic violations and something shot out at me immediately. On 9/10/2003 it says I received a speeding ticket ; infaction, No valid registration ; CLASS 3 MISDEMEANOR. what the heck??? I.........