Hello all, I have a few of those 1042's from my July trip but my losses far outweigh my jackpots, therefore a US tax return is in order to get some of my scratch back. I have never filed a tax return to get the $$ back before, so I don't have an ITTN. My question is, can I apply for an ITTN NOW before I actually file my first return in January, So I will only have one form to complete when it comes tax time, thus speeding up the process? Thanks in advance!
Seems like a bit of a PITA, since this is my first return I may eat 20%-25% of my return and have one of those companies like RMS or Casino Tax Rebate do it for me!
I too need to do the same thing, had same question. I went on line and pulled up the actual tax forms that are required, and both as I recall looked very easy ~ though I haven't completed them yet~ Before you send it off and lose that chunk of $$, make sure the forms really are more than you want to bother with. My sister completed them several years back and said it wasn't too big of a deal. As the Canadian $$ continues to drop it makes the tax return that more valuable~
I had a 1042 from 2011 and hadn't bothered getting the ITIN or filing for a refund until both my husband and I had handpays last December. I used RMS and yes they took a percentage but to me it was well worth it to not have to bother with that paperwork.
They seem to make a big deal of it on those company sites that I referenced, but then again that IS how they make their money. I did some preliminary research and apparently they are very particular how those forms are filled out, so that's why I'm on the fence. on a side note, I got a call from RMS about a month ago (not sure how they got my number), and they told me that they charge 25%, once I said no thanks, he immediately dropped it down to 20%. I wonder if I called and haggled if I could get them down to 10%, then it would be a no-brainer!
Yes, one thing to consider is: in future years how likely are you to have to file to get taxes back? Because my wife and I typically only play penny slots at less than $1 per spin or quarter VP its not likely we are going to get taxes withheld in Las Vegas so when we had one year where she hit a progressive jackpot ($1300) and another year where I hit one ($1450) it made sense for us to do it ourselves. But if you play at a higher level and are more likely to get taxes withheld then it makes sense to use a tax refund service in Canada - they do charge you extra for your first return filed, but you make up for it in convenience for when you file returns in future years.
It really isn't that difficult. The instructions on the IRS website are very detailed. You should get a certified copy of your passport so you don't have to submit the original with your ITIN app and 2014 tax return. I've also seen H and R Block advertising to do the app and file the U.S. tax return for considerably less than a company life Refund Management if you really don't want to do it yourself. You'd gave to wait until the 2014 win loss statements are available (usually February).
Tax holdback questions I recently won a 5.00 firebet at Ballys in las vegas ($5000) and they took 30% and gave me a 1042-s form for $1500 I have read that winnings on Craps and most table games ( For Canadians) are exempt from this and are going through the process of getting the tax back Less fees ARGGG. I am correct that they should not have withheld the taxes? Thanks for your responses Cronixv
No, table games are subject to withholding tax as well. If you hit a win that is $5000+ and more than 300x the wager, which you did, then you are subject to the withholding tax
Its both the $5000+ and the 300x, so if you can lower your bet to $4 that should avoid withholding taxes because you will be under the $5000 threshold For filing to get your money back its usually not that big a deal: if you use a service they usually charge extra the first time you do it (charging extra for setting up your account, getting you an ITIN, etc) and then on future filings they are a little cheaper. Or you can do it yourself where it might be a little bit of a pain and seem like a slow process to start, but then you don't have to pay a service to do it for you.
I am a CA up north and I still don't get the US tax recovery companies. It is my understanding in the US that you can write off your losses against winnings. So in my mind you have to have your losses to get a recovery. I understand TR and ML and others track this. Is there also a basic exemption for non-residents before you pay any tax? Say you have no losses or at least proof of losses and you win $5,000. How does the recovery work?
I think your suggestion for 4 $ is a great idea and less headache. AND you get a free bet for every 4 under the new approach (4 bets @ 5 $ = 20 $.... and a headache....but 5 bets at 4 $ = 20 $ and you get a "free bet" out of it..... and no headache)...... look on the bright side every time.....good luck.... you walked with 3500 $ and a tax form....under this scenario you walk with 4000 $ and no form to lose.....
The Tax recovery services make you sign a form stating that you had losses exceeding your wins and are responsible for providing the IRS with documentation (ironically win/loss statements aren't technically legal documents but your handwritten journal is) if they choose to audit you. The tax return does not have to have documented proof submitted with the return apart from the W2g forms. I've never heard of any Canadian being audited and I assume there is an internal IRS number for where an audit would be triggered. I think it's reasonable to assume that around 10k in winnings (3k withheld) they probably start looking a little more closely at the return but it wouldn't surprise me to hear there was some wacky algorithm to decide who gets audited.
Yes, you can off-set gambling winnings with losses, but for most people that won't be necessary: the same way Canada has minimum levels of income that you must meet before having to pay taxes, the USA has the same thing - for a married couple its something like $20,000 and around $10,000-ish for a single adult. So in the case of the OP if they file a US tax return and declare they earned $5,000 in US taxable income they don't need to offset winnings because their taxable income is below the threshold for having to pay taxes, so they are already getting everything back anyhow.
Moderator Note: Merged some similar threads and made this topic a sticky. And a big thank you to Auggie for the info
I was thinking the basic exemption is for residents only. Up here non-residents don't get the basic exemption, only residents do. I was thinking it would be the same in US
There is some good info here http://www.taxtips.ca/personaltax/usgamblingtaxes.htm and stuff I didn't know. To wit, taxes withheld on blackjack, craps etc can be recovered without the need for an offsetting gambling loss: If you have winnings from blackjack, baccarat, craps, roulette, or big-6 wheel, and the casino gave you a Form 1042-S (Foreign Person’s US Source income subject to withholding) showing that tax was withheld, enter these winnings in column d of line 10, with a tax rate of zero%. You can claim a refund of the tax.
