Paying Tax On Online Casino: Required? Or Not?

Online casino continued to grow at a tremendous rate because it was so easy for people to gamble at these online casino sites, they grew quickly. People love to gamble, and these sites allowed them an easy way to do it. It can be a lot more fun when the moment you are in your winning streak.

However, the heat of the moment of winning may turn peevish knowing that the Internal Revenue Code (IRS) charges around 30% to form part of gambling winnings tax. This can be discouraging but, the taxes withheld can be taken back from the IRS, in the form of tax refunds.


Let's say, you potted a $600 or more and that amount is 300 times of your bet at a horse racing, you win a $1,200 at slots or blackjack game, or take $1,500-plus in craps winnings, you must get your Social Security number and let the IRS know that you came into the extra income. When you are playing poker, the IRS now requires all poker tournament sponsors to report competitors' winnings of more than $5,000.

The point here is if you are lucky enough to rake in an up to standard jackpot on a gambling transaction, you're going to have to give the IRS your tax information and, in many cases, you're not going to walk away with all the cash you won. Online casino winning taxes alter depending mostly on the amount won, the type of online casino game and the ratio of the amount of winnings to the amount of bet.

Meaning, even if you won in an online casino game, you will not be automatically withheld 30% as gambling winnings tax, it still depends on the ratio between the winnings and losses. There are instances where total bet exceeds the total winnings, so that if you look at the situation, there is actually no winning to be charged with tax in the first place. But given situations like this, the IRS still needs a report on the income earned for them to determine how much gambling winnings tax to be charged.

When there are no specific rules governing the online world, the rules of the real world govern. The rules for gambling income are quite clear. You must keep a log of your sessions, you must report wins and losses by session. All this money goes toward your total income amount. On the other hand, you don't have to pay taxes on all your earnings, regardless of how you got them. You can reduce the amount of money the IRS will tax by reporting your losses as part of your overall itemized deductions.

You must keep an exact record of your winnings and losses, your record should include at least the following information:

* The date and type of your specific wager or wagering activity.

* The name and address or locations of the gambling establishment.

* The names of other persons present with you at the gambling establishment.

* The amount(s) you won or lost.