Will I have to pay tax if I cash at WSOP? - Poker Legislation

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Will I have to pay tax if I cash at WSOP?

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06-08-2011 , 06:37 AM

GhostFacedKiller

adept

Join Date: Mar 2007 Posts: 1,010

I'm not sure if this is the right forum, so feel free to move this if it should be elsewhere.

I am from the UK. I understand that there is some kind of tax treaty which means that I wouldn't have to pay tax if I cash. However, I currently live in Guernsey http://en.wikipedia.org/wiki/Guernsey which has it's own tax system (and as far as I know, no tax treaty with the US).

So, anyone know whether I have to pay tax. Is it based on where I'm from/hold a passport or where I'm resident/paying tax?

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06-08-2011 , 08:36 AM

PokerXanadu

Carpal \'Tunnel

Join Date: Oct 2006 Posts: 10,583

To claim exemption from the US withholding tax, foreign residents need to apply for an Individual Taxpayer ID Number:
http://www.irs.gov/businesses/small/...6,00.html#itin

This form includes your current residence address and your foreign country of citizenship. Which means that you will have to reveal your residence as Guernsey.

You are correct that there is no tax treaty between the US and Guernsey. Your US gambling winnings will be subject to non-refundable tax withholding.

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06-08-2011 , 08:46 AM

G twizzle

grinder

Join Date: May 2008 Posts: 563

Let me add that if you are unclear you should call The Rio and speak to the WSOP office. I am from a country that has a tax treaty with the US and under Article 21 of that treaty, I and my lawyer, think that I should be able to apply for an ITIN number under the 'any other income' category.

However, Harrah's position is that the tax treaty must mention gaming specifically and that the IRS sends them an updated list of valid countries every year. If your country is not on that list you will have 30% withheld and then you can try to file a tax return in January (Form 2240 I think?).

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07-09-2011 , 12:37 PM

forthwrite

self-banned

Join Date: Nov 2009 Posts: 3,358

Quote:

Originally Posted by PokerXanadu

Sorry to bump this thread a month later but I have a question.

Are you saying that where you reside is the deciding factor, not what citizenship you hold?

If I have dual citizenship (Australia and UK) but live in Australia, does that mean I would be subject to money won in the USA being taxed, despite the UK-USA tax treaty?

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07-09-2011 , 12:55 PM

PokerXanadu

Carpal \'Tunnel

Join Date: Oct 2006 Posts: 10,583

Quote:

Originally Posted by forthwrite

Yes, I believe so. Do you pay income taxes normally to Australia or the UK?

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07-09-2011 , 01:12 PM

Russ Fox

tax practitioner

Join Date: Jun 2004 Posts: 884

Quote:

Originally Posted by forthwrite

Technically, Poker Xanadu is correct in that it's where you pay income tax that matters; however, that's not how Caesar's acts. My understanding is Caesar's will look at the country that issued your passport in determining your tax home. So if your passport is issued by Australia, you're looking at 30% withholding; if your passport is issued by the UK, you're looking at none.

-- Russ Fox

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01-03-2013 , 04:47 AM

ad_hanna

stranger

Join Date: Jan 2013 Posts: 9

Quote:

Originally Posted by Russ Fox

Dear sir, i know that you have a wide experience in tax issues, and my question is that do all the casinos in Las Vegas helping players from tax treaty countries to apply for the ITIN number if they cash in tournament and need to fill out tax paperwork. and in case that the casino do not cooperate in this issue and insist to withhold tax from the winnings what the player can do in this case.
Thank you.

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01-05-2013 , 08:44 AM

TAFFYMAN

adept

Join Date: Dec 2008 Posts: 883

Quote:

Originally Posted by Russ Fox

So by this line of thinking a person that lives in the USA but has dual citizenship in the uk and USA only has to show the rio his uk passport and not get taxed?

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01-05-2013 , 11:13 AM

Richas

veteran

Join Date: Feb 2006 Posts: 3,440

Quote:

Originally Posted by TAFFYMAN

So by this line of thinking a person that lives in the USA but has dual citizenship in the uk and USA only has to show the rio his uk passport and not get taxed?

Nah. they might be able to get all the cash from the Rio but the US taxman would have your details, the new ITIN and would easily notice that you are the same US taxpayer that has residency and hence a bill for this income.

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01-16-2013 , 02:47 PM

#10

okcthunderfan

grinder

Join Date: Jun 2012 Posts: 421

I didn't want to make a new thread to ask this question, so I'll ask this question in this thread because this thread has to do with taxes.

I'm a poker player in the US and have cashed out some of my winnings via p2p transfers. Is it possible to categorize these winnings as "gifts"? I mean if the IRS were to audit me, and they looked at my bank account, I could just claim these as gifts right? I assume that US facing sites don't comply with the IRS. Disclaimer: I'm going to pay my taxes, and treat this like income, but this seems like an obvious loophole to me. Maybe I'm being stupid and naive. Thanks.

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01-16-2013 , 03:51 PM

#11

Richas

veteran

Join Date: Feb 2006 Posts: 3,440

Quote:

Originally Posted by okcthunderfan

Oh i get to say this first...

pay your taxes.

No you cannot pretend that transfers to you are gifts when they are income, at least not legally and as you have a pattern not even in a way that does not look suss.

Plus the income is when you do it (bet)not when you get some schmuck to transfer you the cash as a "gift" making their income more opaque

Seriously just read the sticky

http://forumserver.twoplustwo.com/57...ts-faq-740589/

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01-16-2013 , 05:29 PM

#12

okcthunderfan

grinder

Join Date: Jun 2012 Posts: 421

Quote:

Originally Posted by Richas

Yeah I guess I did ask a pretty dumb question, but one follow up question, what is the relationship between the IRS and US Facing Sites, is there any communication between the two? thanks.

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01-16-2013 , 06:13 PM

#13

Richas

veteran

Join Date: Feb 2006 Posts: 3,440

Quote:

Originally Posted by okcthunderfan

Yeah I guess I did ask a pretty dumb question, but one follow up question, what is the relationship between the IRS and US Facing Sites, is there any communication between the two? thanks.

For the avoidance of doubt - pay your taxes.

Now as for your question, as of 22:00 GMT 16/1/13 (or some other US format) the tax man did not have direct access to some un-named off shore sites financial records.

20 minutes later, maybe they will have via the joys of indictment. Whatever, if you pay your taxes what do you care?

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01-17-2013 , 06:38 PM

#14

Rich Muny

Former PPA President

Join Date: Apr 2005 Posts: 28,010

Quote:

Originally Posted by okcthunderfan

It's not possible to do so legally, as these transfers do not meet the IRS definition of gifts.

As to what you can do illegally...we cannot be of assistance. Discussion of ways to evade taxes is not permitted on 2+2.

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