Anyone who has ever gone into business knows they are taking a big chance. People play roulette with their health on a daily basis by eating foods that are clearly not nutritious. Going to work for many is a huge risk. Think about those who serve on the police force.
Then there are those people who gamble in a more obvious way. They go to casinos and racetracks. They buy lottery tickets. No matter how you choose to gamble, the IRS always gets a piece of the action.
For the folks who like to test their luck at slot machines, the winning may not be as much fun if the IRS has their way.
As recently reported in Bloomberg, the IRS is turning their attention to winnings coming from these ‘one-armed bandits.’ Currently, according to the Bloomberg article, “At slot machines, only jackpots of $1,200 or more must be reported to the IRS. A lucky player winning a big jackpot will find the machine automatically shuts down until a casino employee comes over with tax forms.”
What has gamblers in an uproar however is the following, as reported in the article, “As part of a broader re-write of gambling tax rules, the IRS earlier this year floated the idea of lowering the mandatory reporting threshold for slot machines to $600.”
Taxpayers know that the IRS wants a part of any winnings from the lottery, the casino or the racetrack. However, the IRS only lets you report gambling losses if you keep an accurate record, with receipts of all your winnings and losses. However, this doesn’t apply if your losses are greater than your winnings.
It still remains to be seen if the IRS will be allowed to reduce the mandatory reporting threshold to $600 from slot machines. However, if I had to bet, I’d put my money on the IRS winning big against the one-armed bandits.