In poker, are you taxed on all winnings or just profits?

Question

Say I were to play some sit n go's and I ended up breaking even after around 10 sng's. Would you have to pay taxes on the money you won on each sit n go or is it only on overall profit ?

Answer 1

Technically speaking, if you want to prepare your taxes properly every session of gambling must be counted separately as either income or gambling losses. Gambling losses cannot simply be subtracted from your wins, they must be filed as a deduction.

So basically, if you only play tournaments, you should list all the tournaments that you cashed, and all the tournaments that you did not. Tournaments in which you cashed would be considered income (which would be the amount you cashed for minus the buy-in), and the others could be deducted.

If you are a professional gambler or make a significant income from gambling, you need to talk to a tax professional who has worked with professional gamblers NOW. Diligent record keeping is the most important part of filing your taxes properly if you are a pro (or near pro) so you need to make sure you're keeping track of the right things and doing it correctly to avoid problems with the IRS.

Answer 2

You don't need to pay tax on any gambling winnings, whether it be poker or horse racing.  I live in Australia and my husband plays poker and that is all tax free.  You don't need to give your tax file number to play so the governmaent don't know about the money.  That is also like if a family member gives you $1000 for your birthday you don't pay tax on that.

Answer 3

There is a line on your tax return for lottery or gambling profits and loss. You cannot deduct your losses. You only need list the profits, yet you may deduct the cost of them. If you invest $1000 and lose $900, you are at a net loss of $100. But you won't stop there. So another $100 investment and you win $900, then you make $1000. You are a net gain of $0.

The tax code basically says if you win more than you bet, then that is the net gain. That is highly unlikely unless you win a jackpot or the lottery on a $1 bet. Otherwise, there is no gain or loss. No one can prove how much you bet or how many lottery tickets you bought. Even if you won $100,000, who's to say it didn't cost you the same to get that?

No, you didn't have $100,000 to start with, but you won and lost during the time you were playing. So, you really don't have a gain, since you won and lost during the process. So on your return you would list the amounts you lost during play and your net tax would be $0.

Answer 4

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Answer 5

Again don't come to an internet answer board for question like this.

For the U.S.

Anything you win is income and is therefore taxable.

You can offset losses against winning if you use Schedule A.

Consult a tax professional.

Here is what I do.

I have a spreadsheet for cash tables and 1 for tournaments.

I keep track of each session I play and then log all the information.

So at the end of the year I, for tournament play, I have 2 columns to put in my taxes.

Column 1 is all tournament winnings and column 2 is all entry fees/rake paid for the tournaments played.

Column 1 goes into Misc Income and Column 2 goes into Sched A for gambling losses.

If C1 > C2 I am taxed on those winnings.

If C2 > C1 it is a wash.

Answer 6

If you're talking about American taxes, here's how it works:

Any time you get a big win, you get a W-2G form which the casino reports to the IRS. Those W-2Gs must be reported as income on the front of your 1040.

If you play poker for a living, you need more tax advice than you can get from a bunch of Yahoos.

Any losses can be claimed on Schedule A (Itemized Deductions), but they are limited to the amount of income you claimed on the front, and they have to be able to survive an audit.

So you get taxed on the net winnings for the year, not each individual win, but you can't just enter the difference as income.

Answer 7

You deduct your losses from your winnings .... and then you are taxed... so the answer is just your winnings