Poker Tax?

PokerFunKid · Sep 17, 2014

Hey guys. Friends have told me different things about poker taxes. Does anyone know or have own experience with cashing out big ammounts of money? Lets say you win 1M in a tournament. Howmuch tax do you pay for cashing out?

Mat

tenbob · Sep 17, 2014

Depends on where you live, and the tax laws in your country. Here in Ireland, if poker is not my full time job then I would pay no tax at all on a millon doller win.

Sh4rKi · Sep 17, 2014

In Hungary there is no tax. The goverment try to make it If I know well, But they couldn't do that.

Sooo, they wanted to close the sites to. Like Bwin, Bet365 and so on. (the betting sites) But they couldn't do that to ^^

Last problem with these sites was, when I was not able to open Full Tilt

(I did not know that in those times its closed)
Luckyly -> just for a while* ^^

dmorris68 · Sep 17, 2014

You don't say where you're from, but since your profile says you play at Party Poker, I'll assume it's not US. Providing that info might help you get closer to an answer, although for something so important I would suggest you contact a tax professional.

For US players, all poker earnings are considered gambling income, which is fully taxable at whatever your usual tax rate is (in the US, we have a progressive bracketed tax rate based on the total amount of taxable income). Winnings can be offset by losses for the current year, however, so if you had $1000 in winnings and $500 in buy-ins (that you can document), your net taxable poker income would be $500.

Zorba · Sep 17, 2014

No tax in Australia also.

PokerFunKid · Sep 18, 2014

dmorris68 said:
You don't say where you're from, but since your profile says you play at Party Poker, I'll assume it's not US. Providing that info might help you get closer to an answer, although for something so important I would suggest you contact a tax professional.

For US players, all poker earnings are considered gambling income, which is fully taxable at whatever your usual tax rate is (in the US, we have a progressive bracketed tax rate based on the total amount of taxable income). Winnings can be offset by losses for the current year, however, so if you had $1000 in winnings and $500 in buy-ins (that you can document), your net taxable poker income would be $500.

Hmm.. I'm from The Netherlands. Maybe MoD knows more about this for my country. Ill ask him. Few friends said you will need to pay over 25% of a big win. But thats huge. Didn't believe them. Lets say you have buyed in for a total of 0,5M make 0,6M you will lose money instead of win. Think it doesn't work that way.

tenbob said:
Depends on where you live, and the tax laws in your country. Here in Ireland, if poker is not my full time job then I would pay no tax at all on a millon doller win.

Awesome

I've researched it for my country and most websites say they take 25% of gamble games wins. But i hope they don't count poker as a gamble game, because it isn't

MasterOfDisaster · Sep 18, 2014

Basically it always has been in a grey area in our country, but I would recommend to just wait till legislation starts before ever paying any amount of tax on poker. Basically cause the (KSB) asked 29% of winings EVERY MONTH and you couldn't put losing months in it, so only paying over winning months lets say win 1K in januari and lose 1K in februari you would have lost 290 over the course of these two months and only 2 taxes.
And besides that I believe different tax authorities in our country also interpertate these rules different. (WAS JUST A MESS)

Also lots of judges(in different cases) have said what our government was doing with these taxes wasn't right so they have accepted the poker players concerns and seems the KSB an KA finally also accepted this and are making plans to legislate it now. (they basically need all energy to get this going good)

Even more the games you are playing atm, I wouldn't be concerned at all.

Party poker 500K even if you ship that , I dont see any problems.

Also any room with the eu. should be taxfree by now.

PokerFunKid · Sep 18, 2014

MasterOfDisaster said:
Basically it always has been in a grey area in our country, but I would recommend to just wait till legislation starts before ever paying any amount of tax on poker. Basically cause the (KSB) asked 29% of winings EVERY MONTH and you couldn't put losing months in it, so only paying over winning months lets say win 1K in januari and lose 1K in februari you would have lost 290 over the course of these two months and only 2 taxes.
And besides that I believe different tax authorities in our country also interpertate these rules different. (WAS JUST A MESS)

Also lots of judges(in different cases) have said what our government was doing with these taxes wasn't right so they have accepted the poker players concerns and seems the KSB an KA finally also accepted this and are making plans to legislate it now. (they basically need all energy to get this going good)

Even more the games you are playing atm, I wouldn't be concerned at all.

Party poker 500K even if you ship that , I dont see any problems.

Also any room with the eu. should be taxfree by now.

Oh wow lol, like usualy our country is a mess with those things

Well, good to know there's not really a legit tax and i was just wondering incase i ever win a big ammount i won't cash it out untill i know more about it. But i was also wondering about the stakes. Lets say i would cash in the 500K Gtd and they ask a tax of my win lol.. That would be sad. Anyways, thanks

MasterOfDisaster · Sep 18, 2014

Also believe if I did read the new upcoming rules well, is that licensed rooms will pay up to 20% of their profits from dutch players to our government and we will be able to play taxfree after (of course often rooms will cut down on promo's or viplevels of these players)

MasterOfDisaster · Sep 18, 2014

PokerFunKid said:
Oh wow lol, like usualy our country is a mess with those things Well, good to know there's not really a legit tax and i was just wondering incase i ever win a big ammount i won't cash it out untill i know more about it. But i was also wondering about the stakes. Lets say i would cash in the 500K Gtd and they ask a tax of my win lol.. That would be sad. Anyways, thanks

Yes of course if this was 100% the case in our country, you should add this in the staking, making the staking less profitable for everyone of course. (unless our tax authority)

PokerFunKid · Sep 18, 2014

sweet!

MasterOfDisaster · Sep 18, 2014

PokerFunKid said:
sweet!

Basically played so much on different sites that our taxauthority never tracked and also played lots of promotions, private or affiliate games which also often don't get tracked at tracking sites

Leaderboard wins also never get tracked,most freerolls don't get tracked, believe any RB also can't be tracked. Special exclusive buy in games often also won't get tracked, so a lot of winnings if you game select very well are hard to find, I am also using Ewallets to get my cash, so obvious won't do it through my bank

You gotta take into account that I am playing profitable poker for over 6 years now and have two kids and two places, so I really needed it to pay all my bills

PokerFunKid · Sep 18, 2014

MasterOfDisaster said:
Basically played so much on different sites that our taxauthority never tracked and also played lots of promotions, private or affiliate games which also often don't get tracked at tracking sites

Leaderboard wins also never get tracked,most freerolls don't get tracked, believe any RB also can't be tracked. Special exclusive buy in games often also won't get tracked, so a lot of winnings if you game select very well are hard to find, I am also using Ewallets to get my cash, so obvious won't do it through my bank

You gotta take into account that I am playing profitable poker for over 6 years now and have two kids and two places, so I really needed it to pay all my bills

Haha yeah i understand that

My dream is to play poker for living. Thats smart. Friend of me once won a big ammount and he said he cashed it out in small ammounts. He used the poker server as his bank. This way he didn't get tax also. There's even a poker site accepting poker with bitcoins now if i can remember it right. I don't think this is trackable either.

MasterOfDisaster · Sep 18, 2014

Bitcoins is the same altough the value of bitcoins seems to change quicker as EU/USD. Also mostly it are small pokerrooms as well that accept bitcoins.

PokerFunKid · Sep 18, 2014

MasterOfDisaster said:
Bitcoins is the same altough the worth of bitcoins seems to change quicker as EU/USD. Also mostly it are small pokerrooms as well that accept bitcoins.

Yeah true, bit coins are risky. You can play a 100$ tournament in bitcoins, win 300$ and meanwhile you still lost because bitcoins dropped hard lol. But can also work in the opposite way.

dmorris68 · Sep 18, 2014

I would expect poker to almost always be considered "gambling" when it comes to tax law. I know poker players don't like to think of the game as "gambling" but the real world considers it so -- you place wagers on the outcome of a hand, which by definition is gambling.

Tax rates in some countries are unreasonably high, and as I recall the Scandinavian countries were notorious for that. If you recall Peter Eastgate winning the wsop ME a few years ago, he won over $9M USD, and Denmark taxed him $6.6M USD.

Denmark has strict taxation rules for poker winnings - Eastgate has to pay 45% in taxes on winnings up to approximately $520 000 and 75% on the rest (over $8.5 million). The end result will be $6.6 million in taxes, if the Danish government gets what it wants.
Eastgate moved to England shortly after reaching the Main Event final table to protect his future winnings, but it's doubtful whether that will be accepted by the authorities.

vinylspiros · Sep 18, 2014

this is what goes in Greece and its not far from tragic. But it is what it is.

http://www.pokerstars.gr/en/poker/r...gTaxPWTitscalculationandthewithholdingprocess

dmorris68 · Sep 18, 2014

vinylspiros said:
this is what goes in Greece and its not far from tragic. But it is what it is.

http://www.pokerstars.gr/en/poker/r...gTaxPWTitscalculationandthewithholdingprocess

Well, at least in terms of taxation, a 20% cap no matter how much you win is pretty reasonable compared to other countries that tax winnings. The highest US tax bracket is 39.6% of income >$400K. So a large multi-million dollar windfall (poker, lotter, whatever) is going to get hit at 40% in the US, and that's just Federal tax. It doesn't count state and local income taxes which could possibly push the total upwards of 60%.

vinylspiros · Sep 18, 2014

dmorris68 said:
Well, at least in terms of taxation, a 20% cap no matter how much you win is pretty reasonable compared to other countries that tax winnings. The highest US tax bracket is 39.6% of income >$400K. So a large multi-million dollar windfall (poker, lotter, whatever) is going to get hit at 40% in the US, and that's just Federal tax. It doesn't count state and local income taxes which could possibly push the total upwards of 60%.

WHAT!? For real? Had no clue man. Makes the 20% seem pretty unimportnat when you put it that way. Now thats a good reason to double think if you wanna be playing or not.

Thing is that all these years we were used to not paying anything so even 20% seems like alot.

But overall it doesnt seem so bad after reading your post.thnks for the reply.

PokerFunKid · Sep 18, 2014

dmorris68 said:
I would expect poker to almost always be considered "gambling" when it comes to tax law. I know poker players don't like to think of the game as "gambling" but the real world considers it so -- you place wagers on the outcome of a hand, which by definition is gambling.

Tax rates in some countries are unreasonably high, and as I recall the Scandinavian countries were notorious for that. If you recall Peter Eastgate winning the WSOP ME a few years ago, he won over $9M USD, and Denmark taxed him $6.6M USD.

They took $6.6M USD from his $9M USD win??!!?

Wow.. Thats just sad. That is just abuse of power.

joe777 · Sep 18, 2014

It could be the they is trying to deter people from gambling thus implying the rules.

PokerFunKid · Sep 18, 2014

vinylspiros said:
this is what goes in Greece and its not far from tragic. But it is what it is.

http://www.pokerstars.gr/en/poker/r...gTaxPWTitscalculationandthewithholdingprocess

20% i still can't describe how greedy that is.. I mean even if you are playing for a living, it is your work and you should normally pay tax over your income. But poker is diferent. You pay to play. If the goverment would stake 20% of my buy-in that it would be fair lol.

MasterOfDisaster · Sep 19, 2014

vinylspiros said:
this is what goes in Greece and its not far from tragic. But it is what it is.

http://www.pokerstars.gr/en/poker/r...gTaxPWTitscalculationandthewithholdingprocess

I met a couple of Greek guys in my last live tour in Finland (Giorgios won that tournament btw) Basically everyone from outside Scandinavia, joined together on the cruiseship that went from Stockholm to the island.

Believe they told me, if they win 1K today, they have to pay tax on that 1K, but if they reg with that 1k for future tournaments, they see it as a BE day.
Let's say they lose 1K next day , they will unreg again and have 2 BE days for taxauthorities, is this right?
Otherwise they have to pay tax on a daily basis and can't put losing days in it.

vinylspiros · Sep 19, 2014

MasterOfDisaster said:
I met a couple of Greek guys in my last live tour in Finland (Giorgios won that tournament btw) Basically everyone from outside Scandinavia, joined together on the cruiseship that went from Stockholm to the island.

Believe they told me, if they win 1K today, they have to pay tax on that 1K, but if they reg with that 1k for future tournaments, they see it as a BE day.
Let's say they lose 1K next day , they will unreg again and have 2 BE days for taxauthorities, is this right?
Otherwise they have to pay tax on a daily basis and can't put losing days in it.

sounds about right but im not sure. All i know is that every 24 hours at 7 am, they deduct the amount won from your account so if you register in the new tourneys prior to them extracting the taxes,it seems likely that it is a good way to not pay the tax.

Good point your making here. interesting.

Poker Tax?

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