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Old 09-04-2017, 07:31 PM   #1
MazTr
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Hey guys Im new to online poker and have questions about taxes!

Hey everyone!

Global poker is the first ever site i played online poker on and cash out. I very new to all the laws and stuff regarding keeping track of winning and losses and what ever else that needs to be recorded. Im making this post to hopefully find a person that could breakdown how this works going towards tax season. Another question to add. Would we be getting a form from GP or paypal? if so what kind of form would it be. thanks in advance!
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Old 09-04-2017, 07:38 PM   #2
mrfunnywobbl
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Re: Hey guys Im new to online poker and have questions about taxes!

Depends on your country
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Old 09-04-2017, 07:44 PM   #3
MazTr
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Re: Hey guys Im new to online poker and have questions about taxes!

Do you mean state? If so Arizona and also looking for information about nyc for my friend.
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Old 09-05-2017, 08:03 AM   #4
a dewd
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Re: Hey guys Im new to online poker and have questions about taxes!

PayPal sends out the 1099-K form if you qualify. You will likely not qualify for it...

** You must have made over $20,000 through one credit card processor, such as PayPal AND
** That $20K must have been made through 200 or more transactions


If you do not, then the onus will be on you to report what you made/lost. Since you are in the States, your best/safest option is to walk into on of the HR Block offices, or a competitor, and ask them for advice. Relying on some random person, self included, on the internet for tax advice is a recipe for disaster.

This can give you some insight on the Federal level

https://www.irs.gov/forms-pubs/about-form-w2g

Check on your state tax website for information on reporting winnings from gambling.

The law states that you must report all winnings, that includes a $2.00 win on a $1.00 scratch off lottery ticket. Your accountant is the one to talk to regarding what you should/need to report and how.
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Old 09-05-2017, 10:39 AM   #5
splayaa
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Re: Hey guys Im new to online poker and have questions about taxes!

agreed with a dewd, and one other point I would make. Keep in mind when you play on Global, you are not playing with USD, but instead $weeps Cash. So when I win a $50 pot, its not 50 in USD, its $50 in $weeps Cash. I don't know about you, but I don't pay taxes on $weeps Cash in any state.

But I do pay taxes on income I receive in PayPal. Including income I receive from Global, and income I get from other things I do as well that pay me with PayPal.

With that said, absolutely consult with a tax professional about your particular situation, because many factors can come into play with taxes and if you get audited, the IRS is not going to take as an excuse... "So I was listening to these guys on 2+2, and they seem really smart..."
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Old 09-05-2017, 08:31 PM   #6
OilSpill
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Re: Hey guys Im new to online poker and have questions about taxes!

Also, I have heard of people recording gambling losses on taxes and they apparently get a deduction?
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Old 09-05-2017, 09:05 PM   #7
coordi
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Re: Hey guys Im new to online poker and have questions about taxes!

You can deduct losses up to your declared winnings
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Old 09-06-2017, 12:20 AM   #8
Hrmmmm
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Re: Hey guys Im new to online poker and have questions about taxes!

Quote:
Originally Posted by splayaa View Post
agreed with a dewd, and one other point I would make. Keep in mind when you play on Global, you are not playing with USD, but instead $weeps Cash. So when I win a $50 pot, its not 50 in USD, its $50 in $weeps Cash. I don't know about you, but I don't pay taxes on $weeps Cash in any state.

But I do pay taxes on income I receive in PayPal. Including income I receive from Global, and income I get from other things I do as well that pay me with PayPal.
I agree with you here. I'm not sure there are any real precedents to dealing with this. The problem is that you have to pay taxes on sweepstakes much like you have to pay taxes on poker, but when exactly does a sweepstakes situation become a prize? Is it a prize when you win a pot or a when Global changes it into cash? I would say that when Global exchanges the $weeps Cash for cash then it becomes a prize.
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Old 09-06-2017, 12:22 AM   #9
Hrmmmm
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Re: Hey guys Im new to online poker and have questions about taxes!

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Originally Posted by OilSpill View Post
Also, I have heard of people recording gambling losses on taxes and they apparently get a deduction?
Federal, yeah, but a few states have codes where you actually cannot. It is heinous, especially for tournament players.
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Old 09-06-2017, 07:00 AM   #10
splayaa
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Re: Hey guys Im new to online poker and have questions about taxes!

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Originally Posted by Hrmmmm View Post
I agree with you here. I'm not sure there are any real precedents to dealing with this. The problem is that you have to pay taxes on sweepstakes much like you have to pay taxes on poker, but when exactly does a sweepstakes situation become a prize? Is it a prize when you win a pot or a when Global changes it into cash? I would say that when Global exchanges the $weeps Cash for cash then it becomes a prize.
For now that is how I am seeing it. And my argument for this being, what if I was playing the McDonald's Monopoly game of old.

I get the pieces for Boardwalk and Park Place which means I am going to win the cool $1,000,000 prize. When would I pay taxes on this win? Obviously the pieces before they are turned in hold no taxable value.

Its once I go and turn in those game pieces for USD that I would see tax forms and claim those winnings.

So for all of that reason and logic, I won't be claiming anything until it comes into my PayPal account. And this is also one of the reasons I am not moving money back and forth a lot either, I would rather keep the bankroll in Global (despite the risks associated) than move the money back and forth and create the problem of whether or not I can claim deductions of money that goes in.

Because there again, I am only purchasing Gold Coins, and getting bonus $weeps Cash, where as when I play on a different regulated real money site, I would be able to count things as losses and gains. I won't be taking as a deduction any money I put into Candy Crush. I get that Candy Crush won't ever redeem my funds for real USD, unlike Global, but I don't know that the government cares. Buying of virtual goods for entertainment isn't going to be a tax deduction no matter how you want to dress it up.
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Old 09-06-2017, 07:16 AM   #11
a dewd
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Re: Hey guys Im new to online poker and have questions about taxes!

Quote:
Originally Posted by splayaa View Post
For now that is how I am seeing it. And my argument for this being, what if I was playing the McDonald's Monopoly game of old.

I get the pieces for Boardwalk and Park Place which means I am going to win the cool $1,000,000 prize. When would I pay taxes on this win? Obviously the pieces before they are turned in hold no taxable value.

Its once I go and turn in those game pieces for USD that I would see tax forms and claim those winnings.

So for all of that reason and logic, I won't be claiming anything until it comes into my PayPal account. And this is also one of the reasons I am not moving money back and forth a lot either, I would rather keep the bankroll in Global (despite the risks associated) than move the money back and forth and create the problem of whether or not I can claim deductions of money that goes in.

Because there again, I am only purchasing Gold Coins, and getting bonus $weeps Cash, where as when I play on a different regulated real money site, I would be able to count things as losses and gains. I won't be taking as a deduction any money I put into Candy Crush. I get that Candy Crush won't ever redeem my funds for real USD, unlike Global, but I don't know that the government cares. Buying of virtual goods for entertainment isn't going to be a tax deduction no matter how you want to dress it up.
Well, unless you really expect t be audited, a reasonable report would be the PayPal to VGW as the ourchase and the PayPal received from vgw as the proceeds. Again, ask a tax attorney/accountant, but there should be off setting numbers. You can deduct lottery tickets off you taxes.

I'd guess the only way you'd raise eyebrows is if you try to justify winnings of $20K with purchases of $15K kind of thing. Personally, I'm very confident that they will not look twice at me if I say I spent $45 at vgw and received $3400. They usually don't argue your claim if you are paying taxes on a high rate of return. I'm even more confident that I will have adjustments against that $3400 to the point of owing almost nothing.

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