Professional Gamblers are Given a Tax Break by the IRS

0
366

gambling taxesThe Federal Government is now accepting the fact that a “Professional Gambler” is a real job and has now enabled gamblers to take tax deductions for their business expenses. But as usual this new found “generosity” from the IRS does not come without its exceptions. First you must determine what they classify as a “Professional Gambler” and then determine if you fall into that category. In January the US Tax Court amended their opinion on what is considered legal deductions for a gambler, which stood at their winnings only and have now included gamblers losses also. This is a huge difference for the full time gambler who travels to different parts of the world for their profession. Now with this new tax break your travel expenses and losses can be deducted at tax time.

The court believes, finally that the expenses that are incurred by a professional gambler to reach a casino or racetrack and all the expenses incurred with this travel can be written off just like any other professional traveler. This ruling is a huge victory for all gamblers. A Professor at the University of Nevada, Las Vegas Boyd School of Law, and Steve Johnson who is an expert in the tax laws says that this decision says that gambling is a trade and should not be any different than any other business trade. Gamblers can thank professional gambler Robert Mayo for bringing this subject to light when in 2001 he wagered over $131,000 and won $120,000 from those wagers. On his tax return that year Mayo listed expenses that included the difference between his wagers and his winnings and also included his travel expenses and research. During this case the court rules that his expenses were not from wagering losses but from business expenses which contributed to operating losses for the year, just like an overhead for any business.

Because of this new law gamblers will now be able to go back up to three years on their tax returns to make amendments and claim their business expenses and gambling losses. Experts believe that although this is a great breakthrough for professional gamblers, they don’t believe there will be a lot of gamblers taking this new tax deduction because to qualify you must be a full time gambler and support your livelihood in this manner. Also, most high rolling gamblers get their travel expenses paid for by the hosting casinos.

By Patricia C. Senior Editor casinoplayersreport.com

LEAVE A REPLY

Please enter your comment!
Please enter your name here