So for the casual gambler who goes big a few times a year and hits 10 or 12 hand pay's on slot machines, the LLC route may make sense. This is because of the changes in tax codes for individuals improving the standard deduction. Normally when itemizing you offset winnings with your losses, and reduce the tax burden. However, if you don't itemize due to standard deduction being better, then you pay on winnings without offset.

The LLC would have "profit/loss" and expenses combined to show the "real income" to the owners and therefor probably be able to pass muster

Two people set up an LLC or Corporation, and make it a travel agency specializing in casino junkets for clients. Hell get licensed as a travel agent for that matter and use that to try and get other travel benefits.

Seems logical to me, but as a true MBA guy i'm always open to feedback

Thanks
Robrmi

Forming an LLC is risky because this hasn't been explored much and no one knows how the IRS will respond. I thought about doing this many years ago but the risks seemed high.

There are legitimate reasons for doing this however, and even though I'm not an accountant I think it falls within certain parameters of the law.

Let's say for instance that you funded an LLC with $500,000 as your "bankroll" or "capital". You issue yourself a $50,000/yr salary from the LLC. You start a business with the LLC, for example, you open a retail store. You use the $500,000 as capital to fund both the store and the playing of poker. All poker and store profits go back to the LLC cash reserves. You then use this capital to grow your store, hire more employees, open another store or start another business. Your business expansions and losses on your "stores" are written off against your poker earnings.

This allows for a lot more deductions against your poker earnings as you can buy up various assets. Maybe you buy a commercial property with your poker earnings and can write it off. Who knows if your businesses will be profitable. It's another gamble. But that's what business is in general: a big gamble. As long as you're actually trying to conduct legitimate business with your LLC, you're doing what most corporations do. You're expanding your stream of income into more potential streams of incomes while expanding the US economy.

This is how a lot of businesses and corporations do it. They have many different types of business and streams of income. Maybe they have 5 businesses but only 1 are profitable. The tax code is setup this way so that business owners don't have to pay full tax on their income, but so that they can use the income to grow their businesses and the economy. So if you're using your poker income to actually grow other businesses, I think you fall within the same argument and protection that other corporations fall under. But if you're just using an LLC exclusively for poker and to funnel money into a tax haven you probably don't have the lawyers to fight off an IRS court battle like a corporation like Amazon can.

JDalla,

This is easy, have 2-5 friends who opened an LLC when they used to play online as props on Cereus LHE.

Taxation is quite easy as well, best friend / Sheseasy was VERY aggressive on Tax deductions was audited once but kinda their fault when write off from bars, clubs, & trips overseas + Vegas, LA was too careless .

The problem with this is that, if a customer or vendor of your retail establishment files a lawsuit, they can go after your poker earnings as well because they are commingled funds. Instead, I would create two separate entities and do a capital drawdown from the poker LLC and a capital infusion to the retail LLC.

I worked for a real estate development company that had over 700 LLCs and S-corps in its portfolio to avoid a situation where the entire umbrella company could be responsible in the case of a large lawsuit. Many companies do this; it is perfectly legal and WILL limit liability unless there is criminal wrongdoing.

As many have said, my above suggestion is not legal advice, just a logical suggestion instead of commingling funds. Probably a better option is to create just one LLC for the retail entity, which deserves the limited liability. Again, not legal advice.

Disclaimer: I don't live in the US

This all seems like hooty tooty. Poker is played by persons, not companies. Are you going to register an ACR account under a damn LLC? Lol ok.
Shouldn't work with live poker either since there are no receipts for the book keeping of transactions made..