Casino winnings taxable in USA

[Obi-Wan Kenobi]

My wife won $1,206.60 at a Oregon Casino last December. The limit for winning with out withholding tax is $1200, so she was $6.60 over. They withheld $361.98 in tax and gave her form 1040NR & a W7 to fill out and send in. They sent back to us saying she was not entitled to refund. We could re-apply using same tax form, but an updated one, and send in a notarized copy of passport and the notary must be from the US.
I guess they want to make this so difficult in hopes we just drop the refund.

[TW]

Hello and Greetings,
pls do not drop the claim. Every Dollar counts. It's a FULL Tank of Diesel.
On the way back home you can stop at a Notary.
Do not get a sunburn!

[frankdamp]

Wouldn't your BC driver's licence/address and Canadaian passports have convinced them that you weren't subject to US taxes? What a rip off - $362 withholding on $6 over the limit!

Please tell us which casino so that we can all avoid the stupid nincompoops, even though we're US residents.

I guess the word is, if you win just a few dollars more than $1200, respectfully decline to accept the excess and tell the casino where to put it (perhaps not so respectfully).

[ruppr]

Frankdamp, your chasing the wrong people. IRS gives the players a free ride up to $1199. They depend on your honesty to report gross winnings on that amount and under. IRS requires the casino to hold out withholding @ $1200 up--- regardless of what kind of I.D. is furnished. You then apply for a refund from IRS (if not a US resident) with proof showing that.

His problem (that he is referring to) is with IRS, NOT the casino. And, if he sent the refund request to the casino----------

Best,

ruppr

[Route 66]

Yep. An IRS requirement the casino must follow if they want to stay in business.

[a k]

Just remember, when you use that little card in the slot machine, the IRS knows what your winnings and losses are. Didn't realize it until I went online with Harrah's and sure enough, you can get your win loss from them.

[frankdamp]

I still can't understand why the OP got dinged for over $360 when the winning was only $6 over the limit. Surely the withholding should have been on the $6, not the whole thing. If that's the rule on all US casinos, I guess we might stay at one, because some of them have reputations of being very nice CGs, but I'm sure not planning on gambling there.

As a matter of interest, can you claim losses to offset your winnings?

[RVhauler]

Used to be that losses up to the amount of winnings were deductable. May have changed tho like lots of other tax items.

[Dadeaux]

Sadly I've never had that problem.

[ruppr]

You can claim your losses but the IRS requires pretty stiff record keeping for proof if your audited. (One of the best is a pocket notebook with date, length of time, amount per bet , machine number or table number, etc. Most casinos will furnish a won/lost record at tax time on request, but the IRS does not necessarily accept it.
Again, once you pass that magic amount, your taxed on the whole award, not the amount over. After all, that is $1199 with no tax. (Think of it as moving into another tax bracket.) :-))

Best,

ruppr

[Wayne M]

Send me the winnings and I'll pay the taxes.

Or, just send me the $844.62 and I'll send you back the $361.68 that you paid in taxes.

Whenever I go to a casino, I may as well just drive by the front entrance and throw a $100 bill out the window and keep driving.

[GeoSKlak]

I'm sure you are not used to all the tax rules down here because in Canada you can win MILLIONS and you don't pay a dime in taxes on your winnings!!

[TW]

Quote:

Originally Posted by GeoSKlak I'm sure you are not used to all the tax rules down here because in Canada you can win MILLIONS and you don't pay a dime in taxes on your winnings!!

Because it is made with our own money (after Taxes), so - they leave us with the fun alone.

TW

[JayGee]

Last time my wife and I left a casino I told her that it would be cheaper for us to just mail the casino a check. It would save us fuel, food, and lodging dollars.