Using PokerTracker for Taxes...

[Talking Poker]

pshabi (or anyone else) - Did you ever figure out how to add up all your winning session and all your losing sessions to get IRS friendly totals, by using Poker Tracker for a selected date range?

[PShabi]

No, I haven't yet. I was thinking of tackling that this weekend. I'll be claiming each day as a seperate "session." I can't imagine manually going through each day, that would suck. With PT, there's usually a way to do anything.

A search at the PT forums may help.

[Talking Poker]

You'll be claiming each "day" as a session, or each "session" as a session? PT should allow us to do it either way, and I'm guessing the IRS would prefer the latter.

I'm a bit nervous about doing it this way, because I am realizing this could be a major boost to my total income (and my total deductions of course), which could put me in a higher tax bracket which could suck for the rest of my income... if that is indeed how it works. If the tax bracket is determined AFTER the gambling loss deducion, that it will wash out and won't matter. But I'm not sure about that. Something you wrote in the other tax thread got me wondering.

[PShabi]

Bro, I switch tables 10 times in a session sometimes. No way in hell I'm claiming every table change as a new session. If you were at a B&M and had a table change, that wouldn't start/end a new session. Similarly, if you went to a B&M played 5 hours, took a "meal break" and came back, I wouldn't think you would say that is a "new session."

I've done a lot of reading, coming from players making much more money than I do. A majority (maybe even all) of the players are defining the session as "one day."

Unfortunately, the bracket is determined before the deductions. It sucks and it's ridiculously unfair.

[Talking Poker]

Damn.... that could end up costing me a LOT.

Ok, if a session is one day, great..... Find me some sort of PT query I can run to come up with THOSE total win and loss numbers.

[jaeh00d]

where is it you guys download or buy this program? this is allowed by the the stars and party poker? i'm sure i'm getting it confused with some other program mentioned here through the threads.

[PShabi]

Yeah, you could be a net loser and still end up paying more to the gov't because you're a poker player. It's so ass backward, it's funny.

I've never dealt with the IRS, but if you were audited, I think they'd be satisfied with the itnent to honestly report the winnings. If you're trying to hid shit, you're in trouble. But if you are making an attempt to interpret the law and be honest, they aren't going to drop the hammer because of a minor discrepancy.

Either way, I don't understand why this law would ever be put into effect. It makes no sense and may have been created by some bible thumper hell bent on converting evil gamblers.

It should be net profit reported as income, period.

[PShabi]

Although I have no clue what to do with these "queries." Also, it may be a total pain in the ass if you have 50 different sites on your database with multiple aliases.

[PShabi]

A post I just copy/pasted from the PokerTracker forums. Dude has to claim over 100k in additional income, yet only had net gains of $6,000. Rape.

From

I just spereated my sessions from gross winnings to gross losses. and I was hit by sticker shock. I play 5-8 hrs a day and 4-6 tables at mostly 5/10 limit.

I make 83K at my job, my wife makes 45K so our income is around 128k. to my surprise I have won (gross winnings) through oct. $123,410 usd
with a gross loss of 119,885.

just thinking ahead to tax time this is gonna vault me way up two tax brackets. For about 3k in winnings and another 3k in bonus.

Hardly seems fair my extra taxes will most likely be more than the 6-7k I netted.

[PShabi]

Wish I knew how to use them.



Yes, I am getting paid by my employer to do this tax research.

[Talking Poker]

I'm pretty sure I linked to all of those earlier in this thread already, pshabi. But thanks for double checking my work.

I also emailed PT support earlier today, asking them directly about adding a "Taxes" feature. Hopefully I'll hear something back from them.

As for the guy who says he's been moved into a higher tax bracket, I still have trouble believing that. In fact, I'm all but positive he's full of shit, or at least very confused anyw.ay. Isn't your tax rate based on your ADJUSTED (meaning after your deductions) Gross Income? I know you have said otherwise before, pshabi, but the losses really should come out fiurst, before the tax is calculated. Otherwise, I don't even know how you would deduct them.

In other words, like with the guy above:
128k total income = 28% tax rate (I think - I'm not looking it up). Add in the 6k net from poker and he's at 134k, which is still 28%. And that 28% is on the last of the dollars he earned, of course. That's something else people don't understand about taxes. He doesn't have to pay 28% on ALL the money he earned. The first however many thousand are taxed at 15% and so on and so forth. It's a sliding scale. Your "tax bracket" jusr refers to the last dollar you earned. IT's not the same as your effective "tax rate," which will always be lower.

If what he is saying was true, it would be:
$128k normal income + $123k poker winnings = $250k+ total income. This would be a higher tax rate. Let's pretend it's 33%, it doesn't matter. The point is, if we figure out the tax due HERE, how are we going to decuct his $120k in poker losses? It just doesn't make sense. In fact, I don't think it would even be possible.

I really think the losses will come out first and THEN we'll calculate what taxes are due based on your Adjusted Gross Income.

I just flipped thropugh a 1040 form and this is how it looks to me. Nothing else would make sense. And as ass backwards as the IRS is at times with their outdated laws and guidelines, typically when all is said and done things at least make sense. They may want you to SHOW every penny won and every penny lost, but you're only going to get taxed on the net win.

Ok.... When in doubt, read the instructions:


From what I am seeing, gambling winnings need to be reported on line 21. Gambling losses are then deducted on line 27, but only up to the amount of the winnings, of course. These, plus all your other itemized deductions are added up and deducted from your gross income, yielding your Adjusted Gross Income... and sure enough, THAT is the number that determines your tax due.

So it's all good.

[Talking Poker]

Here is another quick summary plus a few useful links:

[PShabi]

I'm going to start rereading threads I'm revisiting. I can't believe I linked to all of those! D-D-D-D-Dumbass.

Something else I've comed to realize that really scares the shit out of me. In terms of itemized deductions:

In general, if you choose not to make itemized deductions on your tax return, you get to take the "standard" deduction. From memory, I "think" this is $9500. From what I gather, if you take this "standard" deduction, then you obviously cannot itemize gambling losses.

However, if you want to itemize your gambling losses and deduct them, that would keep you from being able to take the "standard" deduction above. So, if you aren't regularly itemizing your tax return, it seems that you're going to be fucked.

I'm starting to wonder how profitable poker really is for me. Fuck life.

[Talking Poker]

Yes, that is correct. People who don't itemize their deductions will need to start itemizing. The standard deduction varies based on your marrital status, number of dependents, and so on.

Pretty much anyone who owns a house itemizes, because you get to write off your mortgage interest. Add in charitable contributions and all sorts of other stuff, and it's not hard to "Beat" the standard deduction. Hell, any poker player should be able to easily beat the standard deduction with their session losses, tourney buy ins, etc. It adds up pretty quick.

[PShabi]

Two cookies for the first person who tells me how to run and use the script in this thread:



What the hell do I do with that code? Start to finish.

[Talking Poker]

You don't need to run that. Just do the session sort thing that you showed me the other day - it works like a champ.

As for the tax problem, your gripe has nothing to do with poker - It has to do with the IRS and the "Standard Deduction." This is the exact same "problem" you would have if that $15k loss was due to mortgage interest or charitable contributions or anything else that one would itemize. Basically, you need to come up with $9500 in itemized deductions just to beat the Standard Deduction - just to "break even," based on how you are looking at it. This is just the way it is.

Instead of looking at it as how unfair this is, look at it on the other side. Your 15k in deductions are what you deserve to write off, so it all works out. The $9500 that you COULD HAVE written off was a gift that you no longer get, because $15k > $9500. Sure, lots of people out there still get their gift, but you don't, because you get MORE than that now.

Yes, it would be very nice if the IRS would allow us to report our net and pay tax on that, instead of reporting our total wins and total losses... but they don't.

[PShabi]

I do need to run it. I want to look at the numbers defining each day as a "session" and see what the difference is. I'm running it in H&R block, so I can do it a couple different ways.

And I see your point on the deduction. It still sucks though. And I'm gonna bitch all the live long day.

[PShabi]

Fine, 3 fucking cookies. Some one tell me how to use it damn it!

[sjay2k]

Gambling income is not taxable here in Australia!!

[PShabi]

That's helpful.

[MathBabe]

Do you still have the (default) Microsoft Access database underlying PokerTracker? Or have you changed it to PostgreSQL? Do you have Microsoft Access?

[MathBabe]

I got my own stats out in a reasonably useful form... these were the steps:

1. Open Microsoft Access. File->Open, browse to c:\PokerTracker\ptrack.mdb and open that.
2. I'm no Access expert, so I'm sure there's a better way to get there, but... click on "Queries" under Objects, click "Create Query in Design view", close the top window that opens up, and select View->SQL view.
3. Now you can paste in the query from the PT forum (the first one) and put in your username. If you have multiple names, or different names on different sites, add the other names at the end of the WHERE statement, as in WHERE p.screen_name='MathBabe' or p.screen_name='MathGrrl'.
4. Click the red exclamation mark and you should see the report. You'll probably want to copy and paste it into Excel so you can sum up the amounts won.

[Talking Poker]

I'm giving this thread a little bump and including the SQL here too, so we'll have it. I got back from the accountant today, and I can say that pshabi is right - reporting sessions day by day is the way to go. I'm on my wayu out now - I'll explain more later.

Here is the SQL:
SELECT MONTH(s.session_start) AS SessionMonth, DAY(s.session_start) AS SessionDay, YEAR(s.session_start) AS SessionYear, SUM(amount_won) AS AmountWon
FROM players AS p INNER JOIN [session] AS s ON s.player_id=p.player_id
WHERE p.screen_name='Rogue23' or p.screen_name='TalkingPoker'
GROUP BY MONTH(s.session_start), DAY(s.session_start), YEAR(s.session_start)
ORDER BY YEAR(s.session_start), MONTH(s.session_start), DAY(s.session_start);

The only parts you need to change are the bolded parts above and you can add as many more "or" clauses as you like.