Canadian Online Poker Tax Thread

[Arnz18]

ok i got a question this year so far I lucksacked 85k in tourneys and also made another 75k playing cashgames which I play for my main source of income if I live in the province of Sask. If I were to pay taxes do I pay on the tourney lucksacks or do i just pay on the cashgame winnings and does anyone know what % I would be paying on any of this. thanks

[TaxGuru]

I don't think it's a no-brainer that you'd legally have to pay either amount (though this is contentious). With regard to the cash games, it is probably 50/50 depending on how long you've been playing and supporting yourself, etc. With regard to the tournaments, a similar, partly independent legal inquiry might be entertained. If you PM me, I can give you some more info about these questions.

If you were to pay, it would be at the applicable marginal tax rates. There is a useful income tax estimator here: http://www.walterharder.ca/T1.html The full rocket would be a little north of $48k.

[milliondollargame]

Originally Posted by TaxGuru

I don't think it's a no-brainer that you'd legally have to pay either amount (though this is contentious). With regard to the cash games, it is probably 50/50 depending on how long you've been playing and supporting yourself, etc. With regard to the tournaments, a similar, partly independent legal inquiry might be entertained. If you PM me, I can give you some more info about these questions.

If you were to pay, it would be at the applicable marginal tax rates. There is a useful income tax estimator here: http://www.walterharder.ca/T1.html The full rocket would be a little north of $48k.

i haven't read the entire thread but this got me thinking about this question. Are we supposed to pay just federal income tax or federal and provincial tax? thanks

[Henry17]

Originally Posted by milliondollargame

i haven't read the entire thread but this got me thinking about this question. Are we supposed to pay just federal income tax or federal and provincial tax? thanks

Why would you think that you would only have to pay the federal?

[Rainbow Warrior]

How could you ever pay one without the other?
Maybe PQ.

[TaxGuru]

What do you suppose happens if you live in the Yukon at the end of the year? (hint: no "provincial" tax)

Also, if you don't live in Canada but are nonetheless a resident as of December 31, you pay federal income tax (and a federal surtax under subsection 120 of the Act) only to the feds. The federal surtax is intended to capture an amount roughly equal to the personal income tax that would have been payable to the non-existent province of residence...

[harangutang]

Have any tax-paying Canadian poker players incorporated? I am about to incorporate and would greatly appreciate any business bank account recommendations experiences. If anyone has incorporated it would be great if they could pm me, thanks.

[Scotty_12]

Originally Posted by kb24mvp

yes...changing USD to CAD at the best possible rate i can get... right now i am using XE... trying to see what is better

I used a company called Globex and dealt with a woman name Snow.

san@globexfx.com is her email, http://www.globexfx.com/ is their website

[thejayman]

Hey guys I have a question about cashing in a US tourney and the 30% tax that they withhold. A few years ago I made small cash about $3K and used refund management system to get the refund minus the 20% fee. Now if I were to cash for say $30K am I still eligible to receive all of the 30% that the casino withholds minus the fee? Or am I only eligible to recover the first $10K or whatever the threshold it is that you have to start paying income tax in the US. For example in Canada the first $9-10K in any income you make is tax free.

Thanks in advance

[xx23]

Have a quick question:

A couple of months ago I won a table share of a jackpot at Commerce, and recently they sent me a letter from the casino telling me I have to give the IRS my social security number. Since I had a Canadian ID, they withheld the 30% and didn't even bother giving me a receipt til I asked. Then they wrote some vague info on a very unofficial piece of paper that I have now misplaced.

Does anyone know if I have to fill this form out and return it, since I'm a Canadian and I've already paid my portion of taxes on it?

Thanks a ton~

[Henry17]

As a Canadian you should be able to get that money back. It is held but then you fill out a form to apply for a number that has a name I can't remember at the moment do to lack of sleep. With that number you then fill out a non-resident US tax return and you should get the money back. Or you can pay someone 20% to do it for you. See ads in back of any Canadian magazine or at 4am on local TV.

[SlightlyMad]

To further elaborate on Henry's point (I'm pretty sure I did all of this in a post a few months ago):

You need an ITIN (International Tax Identification Number). You can start the process of applying for that right now, if you so desire.

You should have received a W2G for the tax withheld from your win at the Commerce. You will need that to prove *you* had tax withheld. You can fill in a 1040NR (non-resident US tax form) to get documentable US Gambling losses back (go to the Poker Legislation forum in case you're asking about how to document poker cash games properly).

There are places that will fill out a 1040NR for a fixed amount, but the last big name accounting firm I went to wanted more than $1K Canadian to fill it out, so I went with Refund Management Services last year ... which was cheaper.

After having looked at the forms, and having my ITIN already taken care of, I think I can handle my own 1040NR this year. It's just a little more complicated than the standard T4, but you do have to read the 56 page manual that comes with it carefully to avoid making a major mistake on your form. Assume you'll spend 4-6 hours reading the documents and then finding the two boxes to fill in numbers on.

thejayman: Because you're a non-resident and are not doing work in the States (I assume), there is no exemption on your first X dollars of income as there is in Canada. It's 30% of dollar 1 through to 30% of dollar N that is withheld. You should be able to get everything that was withheld back, if you can document that you have *lost* more gambling in the States than you have won.

xx23: If you don't have the W2G, you may want to contact the Commerce directly about getting something official for your taxes, and be prepared to explain to the IRS that this is a copy of the Commerce's version of the form, not the original that they gave you. They *should* have a copy of the W2G on file if they've withheld cash from you.

[xx23]

Thanks for the very informative response
I'll definitely look into it and see if I can do it myself.

[poker22]

The thing is, the government is going to tax any kind of income unless you're below the poverty line so you post anything, doesn't matter on the amount, it's all about the amount combined....

[TaxGuru]

Originally Posted by poker22

The thing is, the government is going to tax any kind of income unless you're below the poverty line so you post anything, doesn't matter on the amount, it's all about the amount combined....

I'm not sure what you're trying to say here. An amount of income is typically only included in income as a legal matter if it's income "from a source" as construed by the courts and/or deemed to be so by the Income Tax Act.