IRS proposes lowering W2G level to $600

It's gonna be time to fill the harbor with tea if this shit goes through

 

speaking of that, today the mass gaming commission proposed just the opposite... to go up to the 1200 level...
because it applies here to all casino bets including blackjack, craps, horse bets etc.
i swear the monkeys in charge, no offense to monkeys, have no clue about gaming regulations.

 

Couple points that I'm gleaning here: 1) I completely spaced that the W-2G drives up the AGI, even if the entire amount of all W-2Gs can be offset by losses, because you have to itemize deductions to deduct the losses and as others noted, while you still might not necessarily have a larger taxable income, you could lose a lot of different benefits that phase out or are entirely eliminated at certain AGIs. That's a tough take. 2) It seems like most of us (me) didn't read the actual proposal, instead relying on the article. As described, it actually seems like it's pretty much what I suggested would be a good idea....but it's even better in that the daily W-2G would only reflect the NET win, which is way better than today. It seems to me that instead of railing against this, we should be hoping it goes through.

Sort of unrelated, with my recent big win on the tables, I'm concerned about what to do. I think I need to start tracking all my play for every session. It won't be exactly correct because I can't remember everything from the start of the year, but it'll be close. While I know I'm required to report all winnings, we all know most of us don't. On one hand, I probably SHOULD report it, because there's a CTR out there from the casino and my bank when I deposited the money. On the other hand, I don't itemize my deductions and I sure as hell hope I don't have enough losses to offset the win. (Plus, the other problem is even if my losses exactly equal my wins, I will still owe additional tax because my AGI will go up $15k, but because my losses won't be $15k MORE than my standard deduction, my taxable income will still be higher. So perhaps the best option is to track everything, not include the win on my return and if I'm audited, I can provide the proof. Absolutely worst case is the IRS adds the entire amount of the CTR to my AGI and I end up paying tax on all of that....which would be the suck.

 

No offense taken.

 

Now that the $600 thing is a shuffled to the side and they are looking at a daily $1,200 NET win threshold, it brings up some real issues.

First off, most people that hit a $2,000 slot win, will play it all right back. Net is ZERO, but they have to report the W2-G anyways.

Under the new system (PROPOSED), if they hit that at 1pm, they will blow it all by the end of the day. Nothing reported.

But, if the day ends at midnight, and they hit a $2k win at 11:45, they may have a net win for the day of $1800 or whatever. But, by 2am, it is all gone. But, they got a win for the day before.

Some very interesting scenarios.

Hmmmm

 

True, but you're going to run into that issue no matter what the time threshold you set. If it 4am-4am, then what happens if someone hits that jackpot at 3:45am? And there's no realistic way for it to just be "by trip", because there's just no feasible way to really tell when a trip begins and ends (without it being too easy to manipulate). Either way the new proposed system is, I think, a very positive thing compared to the old system, where that $2k win is reported no matter how much you win or lose during the course of the day.

 

the other scenario where it's worse is if you hit a 2k win and then proceed to hit a bunch of smaller wins, 500, 800, 1100, etc and by the end of the day you are up 6k or 10k or whatever. now your w2-g is for that amount rather than just the 2k it would have been.

the main problem is there is no form filed for your losses. so the next day you dump back the 6k or 10k and you're still on the hook for the previous day.

 

All right folks... here's some info from one of Kickin's buddies on Wall Street analyzing the fiscal impact of such a change.

http://www.reviewjournal.com/business/casinos-gaming/lower-trigger-jackpots-seen-costly-casinos

 

The analysis only takes into account the additional operational costs of lowering the limit to $600 but does not factor in potential lost revenue from players quitting slots altogether as some on this board have commented might happen.

 

Psssst...here's a little not-so-secret secret - industry analysts at the major investment banks are beholden to the companies they cover and their employers, not to investors. If they take a stance against an entire industry they stop getting as much access and their banking desks stop getting deals.

If you want the truth you come to those of us on the buy-side who have no problem shitting on anyone (except our dear investors of course). :Þ

 

If they want to see casino revenue increase and ultimately taxes paid by the casino increase, they should make all gambling wins TAX FREE. The fact is 99.9% of gamblers are losers overall. If winnings weren't counted as income, people would FLOCK to casinos even more as they dream of those tax free jackpots. That would eliminate all record keeping. I know this will never happen but casinos and players would love it.

Alternatively, just go to a federal and state consumption tax and be done with it. Of course, that won't happen because it would eliminate too many jobs propped up by the current tax system. If anything, I agree they need to RAISE the $1200 limit, not lower it.

 

One aspect to circumvent this new rule would be to remove your players card when dealt a decent hand at VP......e.g. if playing DDB or TDB and you are dealt a quad of 2's, 3's, 4's or aces, then remove your players card before you hit the deal button thus reducing the tracking of bigger pays.....not that I would ever try this.

Definitely need to raise the $1200 limit!

 

Amen

 

Shut yo mouf!

 

IRS suggesting dropping casino winning thresholds from $1200 to $600

www.reviewjournal.com/...gaming/irs-su...

 

All the more reasons to be a low-roller. I never want to deal with a W2G, hence I always pay attention to pay tables when I'm making a bet on VP and slots. So, this would ruin my 5-coin bet on quarter JOB. But as a result, I would be gambling lesser amounts, so, maybe even a good thing

I cannot imagine how sucky it will be playing high-limit slots, with the machine going tilt every couple minutes.

 

I don't see how that would help. If you get a taxable win (over 1200) a casino employee comes over and has you fill out a form with your SS number so they can report it

 

Federal, state and local governments make far more off of taxes on the industry than taxes on gambling income collected on wagering. Many civilized nations exempt any gambling activity from income taxes for citizens with recreational winnings. Unfortunately, American residents are not as fortunate, and we must tax the 0.1 percent.

If you go by the strict interpretation of the IRS code in regards to gambling "earnings", anyone with a winning session would be subject to tax, a majority of all gamblers within the year. Perhaps we can hire millions of IRS agents and assign them to each and every gambler as they walk into a casino, to permit real time "income" tracking and tax assessment. Paul Krugman can write a column praising all of the economic benefits to this scheme. They can bring back Lois to administer it.

 

I'm going to give Palace Station a VP try next trip. Not only can I get a good deal on rooms with MyVegas, but they have VP in dimes. I can play twice as long on my bankroll. Sam's Town has Deuces wild in nickels.

Another thing casinos might do is simply refigure the quarter paytables so that no pay is over $599. It would mean learning new strategies, but it would attract customers wanting to avoid the paperwork. If the royal paid $599, a 100% plus machine would have some very decent payouts for SF and lower. SF has always been cheated in the way the payouts are balanced. But I'm thinking I will be happy with dimes on the 10/7 DB.

 

This is a great plan. Make any str8 flush an equal pay (probably around $400) and get rid of the royal designation. You would have to reconfigure higher end pays on DDB, TDB etc. but definitely workable. The .50 denom has always been a funny one to me. After taking state and federal taxes, a royal is worth only slightly more than the quarter royal.

The above statement is assuming people don't pay taxes on quarter royals which obviously is not the case