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A 'taxable jackpot' is a bit of a myth5 April 2013
If you win $1,200 or more on a single spin (including the original wager), the casino will issue you a W-2G. Ill-advisedly, many players have been told that a $1,200 win is the "taxable jackpot" threshold for what they are on the hook to Uncle Sam for. Apart from individual slot wins over $1,200, according to the IRS, you are on the honor system to report additional winnings over the entire year.
A few weeks back I recommended that you document ALL your gambling losses and wins, and recommended you give the Lady Luck Gambling Diary a try. For a mere $3, it just might keep you out of a cameo appearance on Lock-Up Raw. The Lady Luck Gambling Diary was created by Reece Morrel, a lawyer/CPA/MBA who works with a lot of gamblers in Oklahoma and throughout the country. He, like me, believes that the IRS expects you to report ALL income, including ALL winnings! In fact, Reece on his website states, “In one court case, the Judge discredited the testimony of the Gambler/Taxpayer because the reported winnings EXACTLY matched the total amount of the W-2Gs.” Luckily, you are allowed to write off your losses, which for most, are greater than your winnings.
Here’s the deal. Giving tax advice is well beyond my pay grade. With the expansion of gambling throughout America, attorneys, CPAs, EAs, public accountants and IRS employees are just now getting a handle on this area of the law.
My recommendation is that you mosey on over to Reece Morrel’s website: http://www.ladyluckdiary.com and click on Myths, Court Cases and Articles. Plan on being scared straight, or at least into compliance.
Dear Mark: In roulette, is en prison and surrender one and the same rule? Mac T.
They are different, Mac. With en prison you are playing on a true European single-zero wheel, whereas the surrender option involves an American wheel.
With en prison, when you make an even-money bet and the ball lands on zero, the croupier doesn’t take your wager. Instead, your bet is “imprisoned,” and you are forced to “let it ride” until the next spin. If your bet subsequently wins on the following spin, you are free to remove it from the table. The best thing about en prison is that on a European single-zero wheel, this wager cuts the house edge on even money bets in half, down to 1.35 percent.
The surrender option is a modified version of en prison offered in some American casinos. On even-money bets (red/black, odd/even, 1-18/9-36), you only lose half your wager if the 0 or 00 appears. You can leave your money on the layout, or immediately take half the bet. The benefit to the player here is that it reduces the house edge down from 5.26 percent to 2.63 percent.
Keep in mind, Mac, that both en prison and surrender involve only even-money wagers.
Dear Mark: Could you please explain the difference between "to" one and "for" one in a craps game? Charles G.
When playing craps, Charles, there is a significant difference between “to” one and “for” one. For example, when a player is paid 5 “to” 1, he or she is paid five dollars plus their original one dollar wager. With five “for” one, the player is only paid five dollars, which includes the player's original dollar bet. This reduces the true payout to 4 to 1. The player should avoid any of these “for” bets on the craps table because they will reduce the payout for wins significantly.
Gambling Wisdom of the Week: Wine loved I deeply, dice dearly - Edgar, betrayed son of Gloucester in King Lear
Best of Mark Pilarski