If you don't turn your chips into cash do you pay taxes on it? - Poker Legislation

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If you don't turn your chips into cash do you pay taxes on it?

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02-10-2019 , 06:32 PM

djevans

Pooh-Bah

Join Date: Apr 2009 Posts: 5,046

I have a box at a casino and keep it full of chips - I don't usually cash in the chips. If I don't cash in the chips do I have to report it as income, or do I report it as income once I cash the chips?

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02-10-2019 , 06:38 PM

Fore

Pooh-Bah

Join Date: Dec 2014 Posts: 3,777

Your choice to not convert to cash does not change your liability. If I were to not cash any paychecks this year, I have enough emergency cash for that, it does not mean I have as not paid. Just like if the boss were to hand me a bonus check at 11:59pm on New Year’s Eve such that I could not cash does not mean the income is in the new year

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02-10-2019 , 08:05 PM

djevans

Pooh-Bah

Join Date: Apr 2009 Posts: 5,046

But chips don’t = cash until you cash them. If you win cash in online poker you don’t have to play taxes on it until you cash it out right?

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02-10-2019 , 08:19 PM

Didace

Carpal \'Tunnel

Join Date: Nov 2009 Posts: 19,866

Quote:

Originally Posted by djevans

If you win cash in online poker you don’t have to play taxes on it until you cash it out right?

Wrong.

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02-10-2019 , 08:35 PM

socccer4life3

grinder

Join Date: Mar 2011 Posts: 664

Ymmv but aren't most us individuals cash basis tax payers? In your 11:59 check example couldn't you claim you didnt receive it until the following year?

Sent from my SM-G950U1 using Tapatalk

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02-10-2019 , 09:38 PM

Didace

Carpal \'Tunnel

Join Date: Nov 2009 Posts: 19,866

Quote:

Originally Posted by socccer4life3

Ymmv but aren't most us individuals cash basis tax payers? In your 11:59 check example couldn't you claim you didnt receive it until the following year?

No. Cash basis doesn't mean paper bills. It means your income counts when you receive it (a check counts for this).

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02-11-2019 , 08:10 AM

PokerXanadu

Carpal \'Tunnel

Join Date: Oct 2006 Posts: 10,583

Quote:

Originally Posted by Didace

No. Cash basis doesn't mean paper bills. It means your income counts when it is paid to you (a check counts for this).

FYP.

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03-14-2019 , 06:39 AM

Sheep-Goats

enthusiast

Join Date: Jan 2009 Posts: 79

As far as the IRS is concerned income is income.* If your boss gives you two old shoes and a bag of gold you owe income tax on the value of those items. If he gives you poker chips you owe on that. There aren't any loopholes to go through, they don't play games like that.

*Some income types are taxed at different rates than others, but an increase in money or material is always taxable.

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03-24-2019 , 05:06 PM

dustin.d.marks

enthusiast

Join Date: Apr 2013 Posts: 50

Quote:

Originally Posted by djevans

You ONLY have a tax liability on the INCREASE; aka "profit." You are NOT liable for the entire amount that's in your box. That assumes that you don't have any offsets.

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03-25-2019 , 04:18 AM

#10

PokerXanadu

Carpal \'Tunnel

Join Date: Oct 2006 Posts: 10,583

Quote:

Originally Posted by dustin.d.marks

You ONLY have a tax liability on the INCREASE; aka "profit." You are NOT liable for the entire amount that's in your box. That assumes that you don't have any offsets.

This is not completely accurate. See the US Taxes sticky for details on how you are supposed to track and report wins and losses.

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