taxes

[fairfax]

Would love some feedback from players such as reno and boomer. What are us laws on taxes. I have been told if check is under 10,000 you do not have to declare it. also keeping western union slips, picking up losing racetrack tickets, etc. can this help you claim that you were at a loss for the year?

[reno]

I can tell you a great deal about ice cream and the women in Asia (which I plan to do in my forthcoming post), but I'm certainly not qualified to talk about taxes. In fact, I'm on my way to tax court because two consecutive CPAs flaked on me.

I keep in contact with Boomer, and although he is fast becoming an offshore sportsbetting legend and is truly my heroe because of his cajones, he, too, knows very little about taxes.

All I can tell you is what one of the flakey CPAs told me: Whatever reason(s) you claim to justify losses must see the light of day. Your story has to make sense or the
deduction(s) will be denied.

[BigMoney]

fairfax, I have done some research on taxes as relates to sportsbetting. I have consulted with one good CPA and two good tax attorneys, one specializing in offshore corporations and banking.

What I've learned is really not startling. All worldwide net income is taxable. This means all winnings, minus losses and expenses. So yes, it is important to document losses as well as gains.

A net loss for the year is a special challenge, since you'd have to prove that this is really your primary business. If it's not, then gambling loss writeoffs cannot excede your gambling gains.

No checks have to be specifically reported, regardless of the amount. Assume that all checks can be tracked, and therefore verified by the IRS if they so desired.

Cash transactions over $10,000 have to be reported to the IRS; however, much smaller transactions are routinely logged either internally by the financial institution or actually reported. These levels can go down to as low as $3,000.

If you're asking what you can get away with, that is a different question. I'm just giving you my interpretation of the rules.

[dylan24]

actually i had a couple of questions
on this topic. Does anyone know what
level US banks "note" on deposits.
Is it better to receive checks for say under
1k? Also is it better to cash the check
completely, deposit some of it and cash some, or completely deposit it.
thanks in advance

[Alpine]

Excellent Response, BigMoney! That is also my interpretation of the rules. The one thing I'm not certain about is to what extent you can deduct expenses from your winnings. Any further info on what kind of expense deductions are allowable?

Fairfax, you certainly could pickup losing tickets and claim them as losses against your other winnings. Make sure they don't have someone else's "tracking number" on them. Also, if you're a $100 bettor, don't try and collect a bunch of $1000 losing tix. Just remember, if you do get audited, the IRS rep. is not going to be an idiot!

[BigMoney]

Dylan, I believe you are better off just depositing the check. It would of course become a record of winnings. But banks don't get too caught up scrutinizing checks. It's the cash that makes them nervous. Some banks have internal policies that require them to fill out their own paperwork record for cash transactions of $3000 or more. If a customer was making these transactions on a regular basis, then it might trigger them to report to the IRS.

Alpine, the list of appropriate expenses that you can write off depends on how seriously you take the hobby. If it serious enough, you could write off computers, software, line services and subscriptions, books, internet service, phones, office supplies, bank fees, some kinds of travel, conference fees, and even business use of your home.

[dylan24]

big money thanks for the reply

one more question. lately, i just ask
for checks for under 1 k from my sportsbook..
and i usually deposit 95 or so and cash 900 or so.
Is that better to do or would you just
deposit the 995. thanks

[Mikes1212]

If the banks might report it if their are big cash transactions on a regular basis, would it be a good idea to open up a few accouts with different banks? Alos what do you consider "regular" once a week, once every 2 weeks? thanks

[fairfax]

one of the major concerns i have is western union. the clerks make you feel like a criminal and are required to ask you your occupation and other questions. i know this money is tracked. I don't know any other way to get the money over besides bankwire which i figure has to be just as bad. I think it would be too expensive for the books to pick up fees on say 3 or 4 western union deposits in one day to avoid the questions. i belive anything over 3,000 clerks are required to get more info.

[dylan24]

mike. usually 2 checks per week. both
under 1k. so if i'm cashing 900 each
time, is that considered big transaction?
thanks

[mls]

The safest way to send money is money orders via FedEx. You can buy Western Union money orders at most large grocery stores for $500 each and send 20 at a time if you want. No I.D. is required.

[thedevil]

It's my understanding that US banks are required to report any cash transactions over $10,000 made at one time. However you CAN'T get around it by depositing 3,000 a day for four or five days as they are allowed to accumalate the total then report it as one transaction. Be very careful with cash as it sets off all the bells. Western Union cash transactions over 3,000 are monitored by WU. One or two they might not report but a lot of them probably are.

THE DEVIL

[MAXIMUM VALUE]

Can someone comeup with a general guideline as to "how to reduce the risk of raising red flags".(if thats really possible).

A.Get your money to the offshore sportsbooks.

B.Get your money back from the O.S SB to your bank account here inthe states.

C.Spend that money and live happily ever after

[ShiftySheik]

Maximum Value, I concur with mls, money orders are the safest way to send money offshore. Don't buy more than 3000 at one time or else you'll have to show ID. If you need more than 3000, go to another store. Don't use Postal money orders, they are no good in foreign countries. Unless you intend to declare your winnings to the IRS, I think it would be better to cash your smaller offshore checks instead of depositing them. That way they won't show up on your bank statement. If you're moving a lot of money, the offshore bank makes sense. Never move money between your offshore bank and your US bank. Access your offshore account with a Visa/MC & keep cash advances under 3000.

[JohnnyDeMarco]

Any transactions sent Western Union offshore are monitored by the CID division of the IRS.
Western Union works hand and hand with these guys. Fed Ex plays the same game. Almost all inbound & outbound Fed Exes are opened by Customs. Fed Ex doesn't even go to Antigua directly anymore. If the government thinks you are opening an account offshore to hide money, this spells bad news for you. Don't do it. It isn't worth it.