Re: On the contrary (537 Views)
Posted by:
JohnTChance (IP Logged)
Date: July 11, 2006 11:06AM
Ezgoer89,
Though Steve surely gets into the absurdities of the IRS regulations on horse race gambling in his book, by no means does he say not to lawfully report all your winnings. [Actually, he says the opposite: he says keep impeccable records; don't use "10-percenters" to sign illegally for you when you hit a biggie; etc. etc.]
So I feel his "advice" is good. And it doesn't apply to your friend with the 2k.
Also, in one scenario, the IRS immediately withholds 12k of a 48k take. You lawfully report it later, perhaps to have some or all of it refunded to you. In another scenario, a bettor takes the entire 48k home with him, puts it in the bank, gets interest on it, and lawfully reports the episode later to the IRS. Which scenario is better? Personally, I prefer to pay later and take the interest. Similarly, if you hit a trifecta paying $650 for $2 on a $2 ticket, you'll have to fill out a W-2G. Hit it for $325 twice on separate $1 tickets, and you duck the paperwork. Instead of enduring the eternal wait of having a Saratoga teller fill out paperwork, take your picture, and offer stimulating conversation all the while, you're free to get an ice cream cone. Steve's idea of betting trifectas in $1 units [and telling the teller to "repeat that ticket"] is good advice.
As far as depositing 2k five times vs. 10k all at once, it's NOT similar to what Steve was saying. People can deposit money into a bank in any way that pleases them. If it's flagged, tell investigators a strange concept: the truth as to how you got it. [Steve says when he was audited by the IRS, they "really just wanted to confirm that I gambled regularly and wasn't somehow laundering money for criminals."]
Finally... the unsaid dark side of the issue. Forgive me, but I think that most people misrepresent their actual absolute gambling winnings to the IRS. [Somehow. Someway. Yes. They cheat! In this here US of A! Alert the media immediately!] Of course, in the Bizzarro world of online chat forums, people will be be bold and tell about how honest they are - of course, behind the curtain of a fake name - about their reporting of their absolute gambling winnings. In some cases, I can believe them. Most of the time, however, I don't.