As an American if you had 25% of Blumstein would you end up with 25% of $8m or 25% of $4m?

How does that work when you guys win a big score overseas? Still counted as regular income for US players?

Important to be saving a receipt from all expenses. That can add up and defer some tax. Obviously a drop in the bucket on the big score.

That's pretty standard everywhere in the western world. The only difference here is that some countries tax poker winnings while others don't.
Blumstein pays you and you pay the tax man and keep the rest.
Doesn't matter where you win the money, if you pay taxes in the US you pay them on your worldwide income.

being a US citizen doesn't mean you have to pay taxes in the US though if you live in a different country (for a long enough time). OTOH, if you live in the US, the IRS wants your money no matter if you are a US player or not.

When you buy a piece of an american, they will generally pay you pre tax, and then you are responsible for taking care of your own taxes. You will however have to sign paperwork saying you recieved this income from that player.

As an American, your piece of them is taxed like any other type of ordinary income. You will be subject to taxes based on your bracket, and unless you are having quite a bad year, this means you will be paying ~40% at the federal level.

FWIW, this does create an interesting dynamic as a poker player. When you are losing on the year, you have to be conservative. You cannot carry losing years forward, which is complete bull****, but it is what it is. Generally you want to start the year off more conservative so you dont end up in the hole, losing years hurt you badly in poker.

Conversely, when you are up huge, it often makes sense to gamble hard. I am up a few million this year at the moment, if I lost a million then it is only really like losing ~600k (that 1m that I had before, I would have had to pay around 400k in taxes on). However, if I win 1m, then I also win about 600k (400k of the next million I owe taxes on).

This means that when you are in the ~$450,000+ income bracket on the year, you often want to play pretty aggressively on pieces. However, if you get close to around 450k then you want to be more conservative. Remember the first 100k you make, you are taxed wayyyy less on. So winning 450k at that point is like winning 280k, but losing 450k at that point is like losing 340k.

Fun stuff being an American. At least you get the upside of you have to GTFO of the country to play online.

FYI:

NVG has long had a zero-tolerance for political posts. And this can include negatively commenting about America, the American government, specific American politicians, how the American government spends its tax revenues, etc. (applies to other countries in addition to the United States as well).

Here's a memorialization of this policy and the consequences of violating it.

"gamble" with a friend whos having a losing year and win it back at a lower income tax bracket over two years.

How are they figuring a 53% tax rate for Piccioli?

It is strange to me that the Canada and many European countries don't tax the income of professional poker players at all, considering the generally high tax burden those countries have on most of their citizens.

Probably from a state with a high income tax.

Putting tax fraud in quotation marks does not obligate the IRS to give it a pass.

Wrong in the case of Canada. The "windfall tax rule" exempts things such as lottery winnings and big poker tourney scores UNLESS it is shown that such money was earned as part of your primary occupation (as would be the case for a "professional poker player.")

True, but when your income is in the millions the majority of it is in the top bracket, so your effective rate won't be much less than 39.6%

People still talk about some overarching % as being absolute though, even in this thread. It's more complicated than that and most professional poker players will never get above 28%.

Much better write up: http://www.taxabletalk.com/2017/07/2...calling-again/

My understanding for Canadians is that for amateurs, you have to give up a 30% withholding on wins over $1200, but you can recover deductions for losses and expenses at tax time. A Professional would not be liable for US taxes, as long as he or she maintained residency in Canada, did not exceed 180 days in the USA in a calendar year, and declared and paid taxes on the winnings in Canada. A Professional in Canada can deduct expenses, but I`m not sure about losses. I seem to recall that was a grey area years ago when I thought I was a pro.

I've enjoyed a lot of your posts as of late.

Could be wrong but I'm pretty sure that since Blumstein earned the money in NV that income isn't subject to NJ taxes.

He's from NY, which according to the map has a higher rate of 8.8%. On top of the highest federal rate, that gets it to 48.4%... but even that's only on the top $400k+ of income. Where does the other >5% come frim?

So players can come from other countries, win millions and not pay any tax to the US?

ah.... no.

NJ does not have a reciprocal income tax agreement with NV. As a former NJ resident, I assure you, NJ will want (and will get) their %....

As long as the country has a tax treaty with the US, then yes. The UK is chief amongst those.

There's the old joke:

You meet your old friend, Bob, who is really down in the dumps.
'What's the matter, Bob, you look really depressed.'
'I made so much money this year that I had to pay $$$$$$ in taxes.'
'I wish that I had your problem.'

Trying cashing out to a £ bank account with Prima. You get similarly shafted with their exchange shenanigans.

How much interest would a 1 million score earn if the full amount is kept in a bank account until tax time?

You have to pay tax on the first 10k?
And us euros are meant to be the socialists.

Depends on the rates