Page 1 of 2 1 2 LastLast
Results 1 to 10 of 11

Thread: Is free slot play taxable?

  1. #1
    Join Date
    Oct 2007
    Posts
    140
    Trips To Vegas
    55

    Default Is free slot play taxable?

    We're playing in the winterfest next week, and like a lot of casinos, HET now pays off in slot play.

    so what if you win the $5000 free slot play? does that trigger a W2g? how could it when you haven't won real money yet? If you play it in small increments, taking out under $1200, wouldn't that avoid it?

    Anyway, just dreaming, but like to be prepared.....

  2. #2
    Join Date
    Oct 2006
    Posts
    1,945
    Trips To Vegas
    90

    Default

    I'm not a tax attorney, but here goes....

    Free play does not represent any winnings until you convert it into credits that you cash out. The amount of cash that you "win" would be taxable, as is all gambling income. However, I don't think even if you played the free play all at once and cashed out $1200 or more it would trigger a W2-G unless there was a single hit greater than that amount.

    I could be wrong, though.

  3. #3
    Join Date
    Apr 2002
    Location
    Philadelphia Area
    Posts
    309

    Default free slot play

    In my opinion it would fall under the "Windfall Wagering Prizes and Awards" section of the tax code.
    I.E. If you won a new car at a church raffle they would issue you a 1099 for the fair market value
    of the prize. Of course if your diligent, you can offset losses from any type of gaming with losing tickets.
    That's why it's important to join slot clubs as your gaming history is well documented. Just my opinion, but I believe I'm interpreting the section correctly. Please refer to IRS Publication 525 for a more detailed
    explanation. Publication 529 demonstrates how to write off losses if you itemize deductions. Hope this helps. I would hope that Harrah's would somehow not issue a W-2 G, but I somehow doubt that they would not.

  4. #4
    Join Date
    Oct 2006
    Posts
    1,945
    Trips To Vegas
    90

    Default

    Click or hover your mouse to enlarge image Originally Posted by PPtraderal Click or hover your mouse to enlarge image
    I.E. If you won a new car at a church raffle they would issue you a 1099 for the fair market value of the prize..
    But how would you determine the fair market value of the free play? It certainly isn't 100%. And what happens if you hit a jackpot while playing with the free play? Would you get taxed twice?

  5. #5
    Join Date
    Apr 2002
    Location
    Philadelphia Area
    Posts
    309

    Default Free Play

    Actually it would be two distinct transactions. Let's say you won $1,500.00. OK, you put the money in your pocket. Now you take a $ 20.00 dollar bill and hit another jackpot. The Casino issues a W-2 G for the new transaction. I know the tax code is crazy but any source of revenue, whether cash, goods, or services, can be considered taxable. The issue for determination remains the valuation of a $ 5,000.00 free play offer.
    As such this would be a transaction unto itself, and I'm guessing that the IRS would place a value of $ 5,000.00 on that event.

  6. #6
    Join Date
    Oct 2006
    Posts
    1,945
    Trips To Vegas
    90

    Default

    The difference in your example is that you are putting your own money back into the machine. In the case of free play, however, it isn't your money until you cycle it through one of the casino's machines. (The other issue in your example is whether the play on the slots counts as one session or not; lots of murkiness there. Of course, if you trigger multiple W2-Gs, you may be screwed regardless because of the rules for offsetting losses.)

    I'm going to stick with the free play not being taxable, but any winnings you remove from the machine are taxable. The IRS can sue me if I'm wrong, lol.

    P.S. Actually, if I'm wrong, there will be a W2-G issued for the free play and my argument is moot. But that means I'm obligated to report as income any and all free play deals I get from a casino. Ain't gonna happen!

  7. #7
    Join Date
    Dec 2009
    Posts
    15
    Trips To Vegas
    50

    Default

    Free play is not taxable. I know that for a fact.

    Louise

  8. #8
    Join Date
    Apr 2006
    Location
    Dallas area
    Posts
    1,071
    Trips To Vegas
    40

    Default

    I've never gotten enough free play to have to worry about it..but I did see a guy use an offer coupon at Harrahs to get a $2500 Macys card.. and they did not issue him a W-2G with it..he just walked up and got it, said 'thanks' and walked away.
    Life isn't about waiting for the storm to pass....
    it's about learning to dance in the rain.

  9. #9
    Join Date
    Oct 2007
    Posts
    140
    Trips To Vegas
    55

    Default

    Good to know.

    I thought the casinos were going cheap on us with slot play as the win, but at least it's not taxable.

  10. #10
    Join Date
    Jun 2007
    Posts
    5,747
    Trips To Vegas
    18

    Default

    Yikes..............I had the $75 Macy's offer.

Tags for this Thread

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •