Monday, Aug. 29, 2005

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IRS contemplates changes to poker-related gaming taxes

By PokerListings.com

The Internal Revenue Service (IRS) in the United States currently follows a gaming taxation system that was not designed with poker in mind.

However, as a result of the 'poker boom,' the IRS is looking to make permanent changes to their system in order to maximize taxation on poker players' earnings.

Currently, the IRS demands that a person pay taxes on winnings as well as losses. And, contrary to popular belief, the system does not work in a way which allows players to subtract their losses from their winnings in order to report their net income. As such, players who break even may end up owing higher taxes.

In the future, the IRS hopes to establish a system through which a player's earnings can be tracked. Specifically, an improved system of withholding rules covering poker tournaments.

In the meantime, the IRS recommends that players keep a log of their earnings, including dates, amounts and locations as well as receipts, tickets and any other records that could support poker-related expenses and winnings.

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