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cueball1950
10-20-2003, 08:39 PM
I was just wondering if a player wins a tournament if they have to pay uncle SAM or the state where the tournament is held.Like the Open in VA. or the DCC in Kentucky. Or on the viking tour, cat tour, joss tour. or any tour for that matter. Are the winning players subject to paying the tax. Or do the players have to sign a form of some type claiming to be independent contractors of some type. I don't remember if this subject has come up before. If it has i am sorry for the repeat. But curiosity got the best of me.was just looking for some general info..................mike

phil in sofla
10-20-2003, 08:52 PM
I imagine if the purse to the player is sizable, some withholding and/or name taking, Social Security number recording, and reporting to the government might be required, similar to certain sized payouts at the racetrack. But it might must be that it gets formally reported to the tax authorities, not that it is withheld on.

Just guessing, and maybe somebody who has some actual experience with this can be a little more certain.

Rich R.
10-21-2003, 04:00 AM
Except for the handful of top players, with substantial winnings, I don't think the rest have to worry about the taxes. A moderate to low level tournament player or players on regional tours would have no problem proving that their expenses exceed their winnings. However, it would not be a bad idea for them to keep receipts and a record of their expenses.

ManlyShot
10-21-2003, 04:51 AM
<blockquote><font class="small">Quote cueball1950:</font><hr> I was just wondering if a player wins a tournament if they have to pay uncle SAM or the state where the tournament is held.<hr /></blockquote>

As far as withholding at the tournament site: Federal, yes; State, no.

Cueball1950, at Valley Forge and Big Apple, winning pool players were written a check, had to sign a Federal Government tax form and provide Social Security number, and then endorsed the check to the TD and the TD cashed the check immediately on site.

At Big Apple, when Fabio Petroni went to cash in his $750 winnings, he, along with every other non-American, had one-third of his check chopped off and was paid the difference. They weren't very happy about it, but, hey, Welcome to America, Land of the Free and Taxed. If you did not have a Social Security number to provide, then the TD automatically held back a third and paid that third to the Government.

At the 2003 U.S. Open, you had to sign a tax form providing Social Security info and they paid you with a check.

I think most larger tournaments are trying comply with the Tax Code, and pool players need to keep receipts for entry fees, hotel, gas, per diem expenses for end-of-the-year taxes.

ManlyShot

Doctor_D
10-21-2003, 05:00 AM
Good morning:

All earned and/or passive income, in excess of specified thresholds, is taxable at Federal and State levels. However, the player should also maintain an accurate record of her/his expenses; entrance fees, lodging, transportation, equipment, supplies, etc., so that the appropriate expenses and/or deductions can be applied. Since the majority of players incur more expenses then they do earnings, it might be in their best interest to handle all transactions as a business so that the "losses" can be deducted from their gross taxable income.

Your best recommendation would be to consult with a local CPA!

Dr. D.

ManlyShot
10-21-2003, 05:04 AM
<blockquote><font class="small">Quote Doctor_D:</font><hr>Your best recommendation would be to consult with a local CPA!<hr /></blockquote>

Doctor D, very good advice, indeed.

ManlyShot

jjinfla
10-21-2003, 05:48 AM
It is actually a good deal for a person who is successfully operating a pool hall/pool school. Then the trip to the tournament is a business expense and everything is written off to offset profits made in their business. Then they essentially get to travel and play pool for free.

Of course if their main business is not very successful then it just sucks.

But all income must be reported to the IRS. Whether people do it or not is another matter.

When I was in Chicago and the movie crew would set up and was looking for extras they would announce that all the extras would be considered Independent Contractor and so they would receive the gross amount of money earned without any taxes withheld and it would be up to the individual to report the income. Well, of course everybody just cashed the checks and forgot about it. It is just too small for the IRS to go after them.

Hopefully you won't be the one they decide to make an example of like the FBI going after the 20 year old but gave ABC reporters a pass for doing the same thing - twice.

Jake

pooltchr
10-21-2003, 06:50 AM
Very good point. I am an instructor and TD for a regional tour. Anything I make goes into a separate account, and is reported. However, travel mileage, hotel, meals entry fees and even table time are all deductable as a business expense. I do have a business license in my home state and have to do all their paperwork as well. In the long run, it's worth it. I get to travel a good bit, play a lot of pool, and at the end of the year, I give all my income/expense info to my CPA and let him do his thing. He usually saves me more than his fee, which, by the way, is also deductable!

Play by the rules, but use them to your advantage when you can.

Eric.
10-21-2003, 03:38 PM
<blockquote><font class="small">Quote ManlyShot:</font><hr> At Big Apple, when Fabio Petroni went to cash in his $750 winnings, he, along with every other non-American, had one-third of his check chopped off and was paid the difference. They weren't very happy about it, but, hey, Welcome to America, Land of the Free and Taxed. If you did not have a Social Security number to provide, then the TD automatically held back a third and paid that third to the Government.
<hr /></blockquote>


Manly,

I believe Foreign nationals can file a W-8 BEN and reclaim part of the money withheld.


Eric

UWPoolGod
10-21-2003, 03:54 PM
Isn't there a tax on any income over a certain amount of money. If I remember right the top two winners in a local tourney who both won over $1000 had to sign a sheet stating they had won the money and could be taxed on it.

10-21-2003, 05:15 PM
<blockquote><font class="small">Quote UWPoolGod:</font><hr> Isn't there a tax on any income over a certain amount of money. If I remember right the top two winners in a local tourney who both won over $1000 had to sign a sheet stating they had won the money and could be taxed on it. <hr /></blockquote>

THE ONLY THING CERTAIN IN LIFE, IS DEATH AND TAXES. I wished they would gong the old system and just do the national sales tax instead, that would really help the struggling pool pro. What he earns now is not enough, to see one third taken away is a brutal bite.

tateuts
10-21-2003, 05:23 PM
There's a form for it "Pool Hustler's Schedule 9B"

Here's mine:

Line 1... winnings $90
Less, entry fees ($725)
Table Time ($450)
Cue stick depreciation ($200)
Marriage counseling ($500)
Chalk (0.15)*


Net gain/loss ... -$1,785.15
Enter here and on line 23

* You know what they say, "chalk is cheap".


Chris

Vagabond
10-21-2003, 07:36 PM
Howdy,
U can take deduction for all the buisiness expenses.But if u can not show profit from this buisiness for 4 years( Some jurisdictions it is 7 years)The IRS will tell u to shut down the buisiness because it is a bad buisiness.Only few players like Karen Corr,Allison Fisher,Jeanette Lee,helena Thornfeld,Earl Strickland,Johny Archer,Nick Varner,Jeremy Jones ,Buddy Hall do really make profits and they can take deductions with out any problems.Cheers /ccboard/images/graemlins/cool.gif

Brady_Behrman
10-21-2003, 08:39 PM
Anything over 600 gets 30% deducted if none US resident or have proof of EIN #.

Also, There was a bar locally that did the breakpot and the value got up to 1500 a ball, some guy won 8G or so and had to report it. The IRS knew of this Break Pot and was all over it..

Brady

Scott Lee
10-22-2003, 05:14 AM
<blockquote><font class="small">Quote Vagabond:</font><hr> Janet Lee<hr /></blockquote>

Ummmm...who the heck is Janet Lee? LOL Gosh, Vagabond...Jeanette would bitch slap you into next week if you EVER called her Janet! LOL /ccboard/images/graemlins/grin.gif

Scott