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Old 03-10-2008, 08:10 AM   #1
slicktee
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Casinos taking tax from winnings in Las Vegas - help please :-)

Hello

Apologies if there is loads written on this, but I have searched the archive and can not find exactly what I am looking for.

I am going to Vegas shortly and live and work in the UK and am tax resident here. I have been told that some casinos will take tax from your tournament winnings in Las Vegas, but that this differs from casino to casino?

1) Does a list exist of the deductions imposed by casinos for tax on tournaments? If not, can you help?

2) Does this apply to cash play also?

3) Do the casinos take tax from all players or is it only US citizens?

Thanks for any help.

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Old 03-10-2008, 09:12 AM   #2
djpeteski
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Casinos do not tax (or withhold tax) US citizens, they report certain winnings (over a specified amount) to the IRS. That amount varies from casino to casino and day to day.

If you hit one of the big tourneys, and win like over $10K you are going to get reported. If you win a small one and it pays like $1K you won't. If the payout is somewhere in between will vary.

Cash games work similarly, but there are ways to avoid it. I have heard that the B uses your id for cash outs of over 3K. They may not report it, but if you cash out over 3K 3 times per day they will. So, cash out 2K 5 times if you have 10K worth of chips.

The only experience I had with foreigners is I was in the Sahara when the bad beat hit. Two English kids, who were friends, were the ones involved in the hand. They each got like 4K. Both had to show their id's and fill out paper work, but nothing was withheld from their winnings.
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Old 03-10-2008, 09:37 AM   #3
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by slicktee View Post

2) Does this apply to cash play also?
It does not apply to any table game (poker, blackjack, craps, etc.) Casinos only report winnings to the IRS at slots or if you win a jackpot (would apply to poker if it was a bad beat) over a certain amount (sorry, can't recall the amount. greater than 2k or so I think).

Michael
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Old 03-10-2008, 09:55 AM   #4
slicktee
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by djpeteski View Post
Casinos do not tax (or withhold tax) US citizens, they report certain winnings (over a specified amount) to the IRS. That amount varies from casino to casino and day to day.

If you hit one of the big tourneys, and win like over $10K you are going to get reported. If you win a small one and it pays like $1K you won't. If the payout is somewhere in between will vary.

Cash games work similarly, but there are ways to avoid it. I have heard that the B uses your id for cash outs of over 3K. They may not report it, but if you cash out over 3K 3 times per day they will. So, cash out 2K 5 times if you have 10K worth of chips.

The only experience I had with foreigners is I was in the Sahara when the bad beat hit. Two English kids, who were friends, were the ones involved in the hand. They each got like 4K. Both had to show their id's and fill out paper work, but nothing was withheld from their winnings.

Hello, thanks for the reply - just wanted to make the note I am non US citizen - does this change things?
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Old 03-10-2008, 10:47 AM   #5
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

I won a tounament at the Paris that paid $800 and I had to fill out paper work and I got a W2 for it. Any tournament win over $599.00 will be taxed unless you play at the Venetian where they pay you in casino chips instead of cash.
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Old 03-10-2008, 10:57 AM   #6
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Beginning March 4th, casinos are required to report net winnings over $5,000. This requires completion of a w2g. No withholding takes place, unless it's state tax (Mississippi).

If you are a non-US citizen, and you're home country does not have a tax treaty with US, then 28% is withheld from your winnings.

If you are a tax treaty county citizen, AND have an ITIN, you do not get taxes withheld from your winnings. My suggeation would be to get an ITIN from one of the Casinos, as UK is a tax treaty country.
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Old 03-10-2008, 10:59 AM   #7
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

I would think that with the change in tax law we might make this a sticky in one of the forums, as it's a very common topic. Not sure if it's appropriate though. Might include links to cardplayer article about this, as well as IRS rules governing withholding, and a list of treaty countries.

FWIW
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Old 03-10-2008, 02:42 PM   #8
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

I'm not sure about non-US, but if you happen to hit a Bad Beat Jackpot, that amount hits you with a tax report too, for me it was a 1099 report. No clue how that would impact you though.
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Old 03-10-2008, 04:06 PM   #9
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by mfpaul View Post
It does not apply to any table game (poker, blackjack, craps, etc.) Casinos only report winnings to the IRS at slots or if you win a jackpot (would apply to poker if it was a bad beat) over a certain amount (sorry, can't recall the amount. greater than 2k or so I think).

Michael
For slots it's anything over $1,199 on a single spin is a signer.
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Old 03-10-2008, 04:25 PM   #10
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

http://wizardofodds.com/askthewizard/203


check this link for a good write up on the situation. Because you are a non-US resident they may withhold taxes on a large jackpot. As noted above they wont do this for any table winnings (poker, craps, BJ). They cant give you a form 1099 because you don't have a social security number, which is why they end up withholding. Depending on the UK/US tax treaty you might be able to get the withholdings back. I'm an accountant here in the US. Because I am interested on this subject I would be willing to do some research. I have access and am willing to look into the UK/US treaty. I should have a chance later this evening. PM if your still interested. I might have some questions for you as I read through it.
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Old 03-10-2008, 04:56 PM   #11
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Would people who are not experts in this field, stop trying to answer the question?

Sorry, gang, but just because you got a W-2 once doesn't mean that's the standard everywhere. Just because some foreign player got taxed, doesn't mean all foreign players get taxed (as Johnny noted, some countries have tax treaties with the US, and their players face no US withholding).

Slicktee, I suggest you read JohnnyGroomsTD's reply, and ignore all others.
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Old 03-10-2008, 04:57 PM   #12
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by JohnnyGroomsTD View Post
If you are a tax treaty county citizen, AND have an ITIN, you do not get taxes withheld from your winnings. My suggeation would be to get an ITIN from one of the Casinos, as UK is a tax treaty country.
What's an ITIN?
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Old 03-10-2008, 05:05 PM   #13
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by youtalkfunny View Post
What's an ITIN?
An ITIN is an Individual Taxpayer Identification Number; it is issued to persons who need to file US tax returns (or be claimed as dependants on US returns) yet they are themselves not eligible for a Social Security number (most often because they are foreigners).

www.irs.gov

on the IRS website you can search for form W-7 to get more info on applying for one.
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Old 03-10-2008, 05:13 PM   #14
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

I am an expert in this area.... (this is for youtalkfunny's benefit only)

United Kingdom: Article 22: Other Income. U. S. Tax Treaties

“Items of income beneficially owned by a resident of a Contracting State (You’re the resident and UK is the contracting state), wherever arising, not dealt with in the foregoing Articles of this Convention (other than income paid out of trusts or the estates of deceased persons in the course of administration) shall be taxable only in that State (UK).”

There is a technical bulletin that specifically included gambling income in section 22 of the treaty.

What this means is that the gambling income won in Vegas will be taxed in the UK in the same manner it would be if you had won the money in the UK. Vegas still might withhold taxes in some form but you will be able to file for a refund, which I wouldn’t worry about until it happens.

Last edited by Byan_Railey; 03-10-2008 at 05:24 PM.
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Old 03-10-2008, 05:22 PM   #15
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by Byan_Railey View Post
Vegas still might withhold taxes in some form but you will be able to file for a refund, which I wouldn’t worry about until it happens.
They will not, in my experience, withhold taxes for treaty country residents long as you produce a passport. The casino will assist you in getting an ITIN if you don't have one, and then they'll do the paperwork to make it all tax free. It might be safer if you were to apply for the ITIN before you needed it, but I think the major Vegas casinos, anyway, have authorized agents, or whatever it is, that can do on-the-spot ITIN magic.

Where it gets messy is for players who are from non-treaty countries. They get hosed. Many countries do not tax gambling winnings, but they aren't treaty signatories. So the casino has to withhold, and the poor schmuck is stuck having to file a 1040NR at the end of the year to get a refund. And since no non-US person is likely to want to try to navigate a US tax form, they gotta find an accountant to help 'em.
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Old 03-10-2008, 05:22 PM   #16
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

I don't do much international work but I do know that not all tax treaties are identical. I would suspect that not all treaties deal with gambling income in the same manner. Being a resident of a "tax treaty country" isn't going to guarantee no tax. At the same time I am sure 99% of the time thats the correct answer, given there is a treaty in place.
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Old 03-10-2008, 05:33 PM   #17
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by Byan_Railey View Post
I don't do much international work but I do know that not all tax treaties are identical. I would suspect that not all treaties deal with gambling income in the same manner. Being a resident of a "tax treaty country" isn't going to guarantee no tax. At the same time I am sure 99% of the time thats the correct answer, given there is a treaty in place.
http://www.irs.gov/businesses/small/...106252,00.html says
Quote:
Gambling income of residents (as defined by treaty) of the following foreign countries is not taxable by the United States: Austria, Czech Republic, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Japan, Latvia, Lithuania, Luxembourg, Netherlands, Russian Federation, Slovak Republic, Slovenia, South Africa, Spain, Sweden, Tunisia, Turkey, Ukraine, and the United Kingdom.
That's the "treaty countries" I'm referring to.
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Old 03-10-2008, 05:56 PM   #18
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by bav View Post
http://www.irs.gov/businesses/small/...106252,00.html says

That's the "treaty countries" I'm referring to.
You guys are great and thanks for the replies so far - to clarify - it's poker winnings Im worried about as this is what Ill be there doing in Vegas.

As I will be travelling on an Irish passport and am tax resident in the UK, I think that I will be covered ie wont pay tax on poker winnings...
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Old 03-10-2008, 06:26 PM   #19
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Thanks for the link Bav, those posts make more sense to me now.
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Old 04-13-2009, 12:13 AM   #20
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by JohnnyGroomsTD View Post
Beginning March 4th, casinos are required to report net winnings over $5,000. This requires completion of a w2g. No withholding takes place, unless it's state tax (Mississippi).

If you are a non-US citizen, and you're home country does not have a tax treaty with US, then 28% is withheld from your winnings.

If you are a tax treaty county citizen, AND have an ITIN, you do not get taxes withheld from your winnings. My suggeation would be to get an ITIN from one of the Casinos, as UK is a tax treaty country.

i remember back in 2006 they were making you fill out paperwork on any poker win over $1200 (this was in las vegas)


did they raise it to $5000?
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Old 04-13-2009, 01:00 AM   #21
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by Arnold_O View Post
i remember back in 2006 they were making you fill out paperwork on any poker win over $1200 (this was in las vegas)

did they raise it to $5000?
It was never officially $1200. Before the IRS ruling that set it at $5000 (and yes, it is officially and fersure $5000 now for poker tourneys), there was just the Binion's Closing Agreement which set it at $600, but only bound Binion's and nobody else. Some other casinos picked that up (in particular, Harrah's, once they bought Binion's), but many others simply refused to do any reporting.
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Old 04-13-2009, 01:07 AM   #22
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by bav View Post
It was never officially $1200. Before the IRS ruling that set it at $5000 (and yes, it is officially and fersure $5000 now for poker tourneys), there was just the Binion's Closing Agreement which set it at $600, but only bound Binion's and nobody else. Some other casinos picked that up (in particular, Harrah's, once they bought Binion's), but many others simply refused to do any reporting.
thanks
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Old 04-13-2009, 01:49 AM   #23
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

But cash games don't get reported?
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Old 04-13-2009, 02:24 AM   #24
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
Originally Posted by djpeteski View Post
Casinos do not tax (or withhold tax) US citizens, they report certain winnings (over a specified amount) to the IRS. That amount varies from casino to casino and day to day.

If you hit one of the big tourneys, and win like over $10K you are going to get reported. If you win a small one and it pays like $1K you won't. If the payout is somewhere in between will vary.

Cash games work similarly, but there are ways to avoid it. I have heard that the B uses your id for cash outs of over 3K. They may not report it, but if you cash out over 3K 3 times per day they will. So, cash out 2K 5 times if you have 10K worth of chips.

The only experience I had with foreigners is I was in the Sahara when the bad beat hit. Two English kids, who were friends, were the ones involved in the hand. They each got like 4K. Both had to show their id's and fill out paper work, but nothing was withheld from their winnings.
Title 31 of the U.S. Code covers reporting of cash outs in casinos. The reports are generated for Homeland Security to combat money laundering.

Efforts to evade accurate reporting are federal offenses.

Money laundering happens daily and it is a tool of terrorism and the drug trade.
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Old 04-13-2009, 02:45 AM   #25
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Re: Casinos taking tax from winnings in Las Vegas - help please :-)

Quote:
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But cash games don't get reported?
not typically.
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