Copy and pasted...
One of the most frequent asked questions gamblers have this time of year is: "Should I declare gambling winnings when filing my tax return?" My answer to this question is always a resounding "YES". I almost hate to say this but those who gamble professionally and win tend to raise some serious red flags by depositing large sums of monies into their bank accounts. Having funds come in from overseas doesn't help either. Should the IRS ever become suspicious, there is a very good chance they might audit your bank account.
If you happen to be a perpetual loser like me, it should be pointed out that losses can only be deducted to the extent of your winnings. When gambling, it is important to maintain receipts and good records. Betting online you should always print up screen shots of your account history. If you only wager over the phone, call the sports book and request a print out of your account history. You may have to do this every few weeks depending on how far back they keep records in the database (not to mention the fact that printouts of this type may take too long for them to bother). I personally would not rely on someone from the book to do this though.
Now of course if I were a tax cheat, which I am not, I would know that the IRS has no way of finding out how much money I have lost offshore. The tax cheat might make $60,000 this year betting with a sports book located in Costa Rica, for example, but he or she can also claim the same amount in losses. This is wrong and I condemn it!
Next, the IRS cannot audit the shoe box full of cash that sits underneath your bed. Notorious tax cheats will keep less money in their banking account and more cash on hand in their home. My advise to them is GET ADT SECURITY or a pit bull. These types of people prefer using Western Union to send and receive money. The problem with keeping money outside of a banking account is that the funds do not draw interest.
Many a person who decides to live life as a professional gamblers often worries about what will happen to them if they fail to file in a given year. Actually if you do not have a real job, the IRS is less inclined to investigate your lack of filing in fear that you might have succumb to a debilitating injury or disease and will require public assistance. The desperate tax cheat will fast discover an ailment if he or she feels cornered by suffocating government forces?.Among their favorites, Carpel Tunnel Syndrome.
Obviously if you have a yacht parked outside at the dock of your riverfront home, there is a good chance of coming under more intense scrutiny. That's why tax cheats will rarely have any significant assets in their own name (this concept offers added protection in the case of law suits as well).
There are legal ways around not having to pay taxes. Just ask Tyco! Here we have a US company that is incorporated in Bermuda and pays absolutely zero taxes to the US government. The really serious gambler might want to consider setting up an offshore bank account in Bermuda, whereas he or she does not have to worry about paying any taxes. It should be noted that the IRS is currently frowning upon Tyco.
It is strongly suggested that an individual unsure of his or her tax status should seek a professional accountant or purchase any number of online tax filing software programs on the market today such as Turbo Tax. There are also programs to help one decide whether declaring gambling winnings as a business will result in less taxes than declaring winnings as "other income".
Turbo Tax is one of the most recommended online tax filing programs available today. Among the many benefits: time and money spent seeking assistance from professionals as Turbo Tax walks you through each step in an easy to understand format; filing electronically allows you to get an online receipt from the IRS confirming your tax return has been officially filed; and Turbo Tax calculations are guaranteed for all you math dummies out there.
Remember, April 15 is right around the corner folks! Get filing or face prison time and/or a huge fine.
One of the most frequent asked questions gamblers have this time of year is: "Should I declare gambling winnings when filing my tax return?" My answer to this question is always a resounding "YES". I almost hate to say this but those who gamble professionally and win tend to raise some serious red flags by depositing large sums of monies into their bank accounts. Having funds come in from overseas doesn't help either. Should the IRS ever become suspicious, there is a very good chance they might audit your bank account.
If you happen to be a perpetual loser like me, it should be pointed out that losses can only be deducted to the extent of your winnings. When gambling, it is important to maintain receipts and good records. Betting online you should always print up screen shots of your account history. If you only wager over the phone, call the sports book and request a print out of your account history. You may have to do this every few weeks depending on how far back they keep records in the database (not to mention the fact that printouts of this type may take too long for them to bother). I personally would not rely on someone from the book to do this though.
Now of course if I were a tax cheat, which I am not, I would know that the IRS has no way of finding out how much money I have lost offshore. The tax cheat might make $60,000 this year betting with a sports book located in Costa Rica, for example, but he or she can also claim the same amount in losses. This is wrong and I condemn it!
Next, the IRS cannot audit the shoe box full of cash that sits underneath your bed. Notorious tax cheats will keep less money in their banking account and more cash on hand in their home. My advise to them is GET ADT SECURITY or a pit bull. These types of people prefer using Western Union to send and receive money. The problem with keeping money outside of a banking account is that the funds do not draw interest.
Many a person who decides to live life as a professional gamblers often worries about what will happen to them if they fail to file in a given year. Actually if you do not have a real job, the IRS is less inclined to investigate your lack of filing in fear that you might have succumb to a debilitating injury or disease and will require public assistance. The desperate tax cheat will fast discover an ailment if he or she feels cornered by suffocating government forces?.Among their favorites, Carpel Tunnel Syndrome.
Obviously if you have a yacht parked outside at the dock of your riverfront home, there is a good chance of coming under more intense scrutiny. That's why tax cheats will rarely have any significant assets in their own name (this concept offers added protection in the case of law suits as well).
There are legal ways around not having to pay taxes. Just ask Tyco! Here we have a US company that is incorporated in Bermuda and pays absolutely zero taxes to the US government. The really serious gambler might want to consider setting up an offshore bank account in Bermuda, whereas he or she does not have to worry about paying any taxes. It should be noted that the IRS is currently frowning upon Tyco.
It is strongly suggested that an individual unsure of his or her tax status should seek a professional accountant or purchase any number of online tax filing software programs on the market today such as Turbo Tax. There are also programs to help one decide whether declaring gambling winnings as a business will result in less taxes than declaring winnings as "other income".
Turbo Tax is one of the most recommended online tax filing programs available today. Among the many benefits: time and money spent seeking assistance from professionals as Turbo Tax walks you through each step in an easy to understand format; filing electronically allows you to get an online receipt from the IRS confirming your tax return has been officially filed; and Turbo Tax calculations are guaranteed for all you math dummies out there.
Remember, April 15 is right around the corner folks! Get filing or face prison time and/or a huge fine.
