Winning money in the USA.

Hork42

Hi All,,

From my understanding, significant casino winnings in the USA are subject to taxation. As a Canadian, if we say, win a tournament while visiting, are we taxed on this? What if we win money in a normal ring game, does anything happen?

We're going to AC later this month and I'm just curious.

If so, is there a way to recover the taxed amount?

hork.

professor

I think that 30% tax is withheld on any tournament win over US$600. (Both of these numbers are subject to gross errors, however, but the policy is something like this.) As for winning in cash games, who's to know? However, you must declare if you are transporting more than CDN$10K across the border in cash. Hopefully you will find yourself in this enviable situation. Good luck!

ScottyZ

Tax on large payouts (over $600USD) is withheld, but Canadians *can* recover this back in Canada. All gambling winnings are legally non-taxable in Canada (including winnings made abroad).

If you get a large payout in the US (or elsewhere) and the casino withholds tax,

1. Get a receipts for the payout, and the amount of tax withheld. One of the forms you will need is called the IRS 1042-S (called a "winslip").

2. Tell the cashier (or whoever you're getting the payout from) that you're from Canada and they'll probably be able to help you with the details. They have probably dealt with this lots of times in Vegas and AC.

Even if you are Canadian, the casino *still* legally must withhold the tax on large payouts, even though you may recover it later. So be a polite Canadian and don't make a big stink about it, eh?

With some effort & filling out the right forms, etc., I'm sure you can get the withheld tax refunded yourself. However, there are also services such as

http://www.ustaxrecovery.com/

that specialize in this sort of thing where you can find more information (how do you think *I* pretend to look like I know what I'm talking about?), and also who will be able to help you with the recovery if you need it (probably for a small fee or something).

I'm not sure about ring games, since I believe the $600US withholding point only applies to single wagers (a big Keno hit, large sports bet, lottery, poker tournament, etc). As for a ring game, I don't think you have to pay withholding tax simply because a poker session consists of multiple wagers (i.e. you win $45, lose $20, lose $5, win $135, etc). The same thing holds for blackjack, etc. So, even if you're up over $600US in a ring game session, the same tax withholding laws don't necessarily apply.

Imagine being unlucky enough to live in the US and play in large poker tournaments. They have to *pay* tax on their tournament winnings (over $600US). That's what I call a tough house drop to beat. 8)

And I think the amount you must declare is $10,000USD (not Canadian). A minor distinction of course, but a few grand difference. One time I was getting asked this question at the border, and the customs dude quickly went through a whole list of things besides cash that I might have: gold bars, money orders, traveller's cheques, bonds, bills, etc.

"I guess you've got me officer. I forgot about the $1,000,000 notional 5.5% of '09 in the trunk..."

ScottyZ

Hork42

Thanks gents,

Very helpful.

Hopefully I'll have to use the advice during my trip.

hork.

giggles

I just got back from Vegas. I came in 6th in a tourney and got the 1042-S form where they withheld 30% of the prize money. The manager told me to bring the form to the US consulate in Toronto and they'll give me my money back.

ComaU

They only witheld the 30% on you giggles because you never played a hand the whole tourney!

Good thing for you that the rest of them were cannons and you didn't get blinded out till 6th spot.

I heard you realy cleaned up down there. NICE ONE!

giggles

They only witheld the 30% on you giggles because you never played a hand the whole tourney!

Good thing for you that the rest of them were cannons and you didn't get blinded out till 6th spot.

You'd be supprised at how well that strategy works. I was really hoping no one would notice it. Unlike you, I don't usually play my 55 very strongly. Though there are exceptions. I had a great hand with 22 in the nl ring game. Won a ~$700 pot with it. I'll post it in another thread.

I started at the final table and I think it gave me good karma. Alas when we got down to 3 tables I had to push all-in with Q6o against A3o to double through to get some chips. I still feel ashamed playing that hand. :oops: Then I found some hands that's up to my standard such as AA and QQ. I got it all-in with QQ preflop which is not my usual style. But turns out I was way ahead.