Quote:
Originally Posted by riverph7
Knowing that you are a CPA Mr. McCoy.
I have an unrelated question.
If someone claims bounty of 10k in Million $ bounty. If he had fired 3 bullets for the tournament. How would be his gain calculated for tax purposes.
$10000 bounty- $3000 buy-ins.
Or
$10000 bounty is fully taxable?
As Stated before I am NOT A PRACTICING TAX CPA even my answers are worth exactly what you are paying for them
The Casino MAY issue you two W2G'S
Tournament payout (if it exceeds the $5,000 net win threshold)
and
Bounty payout W2G and that would list
REPORTABLE WINNINGS (box 1) AS $9,000 because that is the transaction associated with the winning $1,000 bullet. I THINK that each bullet and the results from that entry would be treated as separate events for tax reporting purposes.
The Casino might also COMBINE the bounty and the Prize pool win in the reporting on a single W2G. It's an interesting question and a good question to send directly to WSOPFAQ for a definitive answer.
The tricky part is say a $3500 tourney cash (taxable but NOT reportable ) with a $10,000 bounty the NET win is clearly $12,500 but it is entirely possible they could REPORT ANY of the following
W2G BOX 1 $10,000 Bounty Win amount only with no entry offset
W2G BOX 1 $ 9,000 Bounty win amount with cost of entry offset
W2G BOX 1 $12,500 Bounty and prize pool win with cost of entry offset
Realize that what is being REPORTED is not what is necessarily TAXABLE by law................ and also why I repeatedly say I am NOT a tax CPA LOL.
Side note upon doing some specific research on the 300 x rule and REQUIRED withholding there may be an exception for poker tournaments.
This has nothing to do with the taxability only if a 24% Withholding is ever a requirement for a person with a valid Tax ID number.