Poker Pros Get Tax Break in 2012
Great news for poker pros in 2012 as the tax court has issued a ruling that is beneficial regarding deductions.
The key take-away is that poker losses are now deductible for professional gamblers beyond your profits, so you can carry them forward and backward to offset income in other years. You can file on Schedule C instead of Schedule A, which limits deductibility.
Of course, none of you probably have any losses to deduct, but it’s nice to know that you have the right anyway.
Under the holding in Mayo and the IRS’ acquiescence to it, professional gamblers are allowed to fully deduct their nonwagering business expenses beyond wagering gains. Nonwagering business expenses may include transportation, meals and entertainment, admission, subscriptions and other fees. In addition, if nonwagering expenses exceed wagering gains and other income, they may give rise to a net operating loss that may be carried back to previous-year returns or carried forward to future-year returns. Professional gamblers still must substantiate the amount and the business purpose of the expenses to secure their deductibility (Presley, T.C. Memo. 1979-339).
- Ace King, Gambling911.comSubmitted by Ace King on Sat, 04/07/2012 - 15:11