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Best of Howard Schwartz

Gaming Guru

 

Before you cry IRS, tax help is available

13 March 2008

The last thing gamblers think about -- up until March or April -- is the IRS and taxes. Yet the annual task of preparing to file comes fast, and that's often the time that the panic starts. Fortunately, two different titles address myriad questions for gamblers and both belong in the gambler's library. These books can be used by the individual preparing his or her own forms or given to tax preparers who might not understand the special circumstances that apply to wins and losses.

Ann-Margarat Johnston addresses taxes with a focus on poker, a good approach because that is her game of preference and because that does seem to be where some of the biggest winnings have been happening, especially from tournaments. This can cause a lot of tax questions. How To Turn Poker Playing Into a Business (Knowing What to Deduct to Improve Your Odds With the IRS) contains 13 chapters, sample tax forms and how to complete them, plus a glossary of terms. Selling for $29.95, this paperbound book clearly concentrates on the one game which for millions has caught on light wildfire due to its popularity on television, online and toward tournament play, nationally and internationally, a phenomenon that means a lot of players could be in need of serious help.

Johnson is a certified public accountant who understands what the lifestyle of professional players entails -- with travel, expenses, tournament fees and something players often forget (record-keeping), documentation, food, legal fees and on the road expenses among other items. Explaining and proving to the Internal Revenue Service how much you won, lost and spent being a professional isn't always easy for the novice to handle, so Ms. Johnston takes you through the process with examples, a virtual checklist of items to consider and what your tax return should look like.

Johnson talks about how the IRS sees the individual's involvement in poker to determine if it is your single occupation; that you are actually doing it for profit; how much time you spend at the job, etc, much the same as they would look at a salaried or commission job. She adds: "The fact that you depend on this activity to be successful is important." She stresses too that many pros who are new to the game try to fool the IRS and cautions about the hazards.

All in all, this is the book poker players and their tax preparers need before the deadline.

The Tax Guide for Gamblers by Roger and Yolanda Roche, is in its sixth edition (64 pages, paperbound, $29.95) and was last revised in 2004. This 8x11 book has always been a valuable resource and continues to be an excellent reference for both the pro and the amateur gambler who has some taxable winnings. Divided into four sections, it is perfect for casual players, novices, recreational players who not only play poker, but other games like race and sports betting, bingo, slots, table games, keno and who may also play on the Internet. There's even a small, but vital discussion about tourists from outside the United States and withholding. The book has a small section for winners of poker tournaments and guidance on what to expect if you get comped.

The chapter titled The Rules for Professional Players is vital because it discusses the tax benefits of being a professional; what proposition players (in poker) must do; and a short discussion of whether it's better to be a recreational player or a professional. Another chapter outlines the origins and structure of tax law and from page 34 on, sample forms you may need or be required to complete are there for you to read clearly.

If you're worried that buying both books might be overkill, don't. If you're a pro, or someone who won big in 2007, get both these books because intelligent tax preparation creates peace of mind, confidence and helps eliminate stress and worry. If you're a professional, they should also be deductible as a business expense and if you have a pro doing your taxes, you will want him to be completely aware of the special circumstances for gambling winnings.

Howard Schwartz
Howard Schwartz, the "librarian for gamblers," was the marketing director for Gambler's Book Club in Las Vegas, a position he held from 1979 to 2010, when he retired. Author of hundreds of articles on gambling, his weekly book reviews appear in numerous publications throughout the gaming industry.

Howard Schwartz Websites:

www.gamblersbook.com
Howard Schwartz
Howard Schwartz, the "librarian for gamblers," was the marketing director for Gambler's Book Club in Las Vegas, a position he held from 1979 to 2010, when he retired. Author of hundreds of articles on gambling, his weekly book reviews appear in numerous publications throughout the gaming industry.

Howard Schwartz Websites:

www.gamblersbook.com