Cash or Reward Credits??

Here's something to ponder:

On March 14, Rincon will have several drawings including a jackpot drawing at 11pm when one guest will be chosen and given this option: take $10,000 in cash or 2-million Reward Credits.

Interesting question.

First, I considered the "cash value" of the 2-million Reward Credits if used for free play. Since I'm 7 stars, 2-million in RCs can be converted to $16,000 of free play.

This raises some questions:

1. Is $16,000 of free play worth more, the same, or less than $10,000 in cash? With a miserable 85% return $16,000 of free play is worth $13,600 in cash. So right away I would opt for the RCs and convert them.

But that brings us to...

2. How quickly can I convert the RCs to free play? There has been a rule that RCs can only be converted to a maximum of $500 free play each day. This means 62,500 in RCs can be converted each day -- unless there is some special rule.

At 62,500 RCs per day, it would take 32 days of play to get the $16,000 of free play.

3. Playing 32 days at $500 of free play each day would entail some other costs: travel and food primarily which would lessen the value of the $500 each day.

The 32 days needed for redemption makes the 2-million RCs less attractive to me.

Rincon will 1099 you on the $10,000 cash. If you don't max out your SSI there will be at least a 15.3% tax on your winnings. Also, you can't write off gambling losses against it.

Last year Rincon sent me a 1099 for $720 for one of the cash days. I would have only taken $595 if I had known this ahead of time.

I no longer go on cash days!

If you play the RCs in Vegas you earn Tier Points.

Quote:

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Originally Posted by Alan Mendelson

Here's something to ponder:

3. Playing 32 days at $500 of free play each day would entail some other costs: travel and food primarily which would lessen the value of the $500 each day.

The 32 days needed for redemption makes the 2-million RCs less attractive to me.

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Alan, you do not need to make round-trips each day. You must be eligible for hotel and you get two free buffets each day. So stay over a weekend and your food and travel costs get mitigated.

FAB

Aaron is correct about the tax but I'm not sure it can't be offset with losses. Can someone confirm that part?

I have checked the web for various articles about how to treat a 1099 for a gambling "prize" and whether it can be offset with losses. It appears to me that a 1099 prize can be offset. I am not a tax expert but consider the following which do mention offsetting a 1099 prize with other gambling losses:

https://ttlc.intuit.com/questions/23...-from-gambling

http://www.goodcasinos.net/the-taxman-cometh.htm

I'd take the RC, given you have 365 days to use them all.
Cash out $500 per day, one weekend a month in Vegas ($1500) playing $1 JoB or BP...99% chance you'd never get a royal AND suck it out at +$10k with NO TAXES!
FWIW: I've "sucked out" $4000 worth of FreePlay so far, for 100% return.

To answer a question I received via email: Because the prize is Reward Credits -- yes they can be cashed out at any Total Rewards casino. They can also be used for meals, shows, etc.