> 5b. Re: Gambling logs
> Date: Thu Jan 31, 2008 12:02 pm ((PST))
>
> --- In vpFREE@yahoogroups.
> >
> > Okay, now here's my problem: Say I put a Benji into a machine. Five
> > plays later, pull a quad but don't cash out. Then, I continue playing
> > and like a stupid, rather than cash out, I play it down to zero. Do I
> > just note the $100 as a loss or do I need to record the quad? If so,
> > do I log $250 as put into the machine or is it a wash?
> >>>>>>>>>>>>
>
> A very strict interpretation of the IRS rules would have you recording
> EVERY wager and EVERY result for each hand you play, but this is just
> plain ridiculous. It is much more realistic to record results
> by "session" - although I don't believe the IRS provides a definition
> of "session". If you walk into a casino with $3000 and leave with
> $2900, record this as a $100 loss for the session. If you walk in with
> $3000 and leave with $3100, record this as a $100 win for the session.
> Just about everyone does it this way. Some people take a more liberal
> approach to what constitutes a "session" and record results by "day" or
> by "trip", which may or may not pass an audit, but I get the impression
> that most people start a new "session" when they change casinos.
>
My gambling buddy who works for the IRS records "sessions" as each stretch at a given machine - anywhere from 15 min. to hours, depending on how long he sits there. For live poker, the session is the stretch at a given table - once you get up and leave, and later come back the same day and play some more, that's a new session. While I'm pretty sure that "session" IS, as mentioned, NOT well defined by IRS, unless it's one continuous sit-down (more likely at poker than VP, although some do spend hours at a time at a single VP machine, I guess), I would think that counting an entire day as a "session" is probably going to be disallowed by some auditors as adequate record-keeping.
Let me restate that - when I say "disallowed as adequate..."
He even records the exact machine ID number, usually on a plate on the side of the machine, for each machine played.
My friend's method has pretty good crediibility as acceptable, since compliance with the regs as much as reasonably possible is essential to keeping his job, and I think they pretty routinely audit IRS personnel for just that reason - to make sure they are good examples. Personally, I'm just a notch less compulsive - I don't record the machine number. I'll have, in my log, something like "$1 JoB, 9am - 10:30am, +$300", "$0.50 JoB 3Play, 10:40am - Noon, -$500", "$1/$2 No limit holdem, 1pm - 8pm, +$400", etc. etc., with the date. I just keep it all on 3x5 cards, file 'em in a box, and send my acct. a transcription of the same information. I note when a session generates a W2G as well.
Oh, and I have the date and location, of course.
I also get my win-loss statements from the casinos, but those are NOT adequate for determination of taxes -- but they can serve as support to show your own record-keeping is pretty much on track.
Compliance with this record-keeping probably results in payment of higher taxes - but that's the case when you comply with any of the IRS regs, in my opinion. So I offset it with liberal use of deductions that I think are appropriate - here, my motto is "when in doubt, do". I figure they never are going to call me up and say, hey you forgot a deduction - and if I'm audited, which I have been (not for gambling though), then you can decide if it's quicker / easier / cheaper overall to pay what they want, or appeal their assessment.
The risk you run with inadquate record-keeping is that they'll gather all the data they can, and decide on their own what your wins and losses were, and assess the tax based on their own data collection -- and I'm sure their bias is "find all the income we can".
If your records are compulsive enough that they have no good reason to audit you based on record-keeping deficiencies, then they have little motive to do so -- just like most businesses, they are expected to have a reasonable return of money on their audits, for the time involved.
--BG
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