Tipping on Handpays - I feel like such a chump...

[Dan Druff]

Many casinos now allow you to put machines in the mode where they won't generate handpays, and will simply make you get a single tax form at the end of the session. Unfortunately, many have not yet implemented such technology.

Handpays fuck gamblers in various ways. They often create false "winnings" for the taxman, and they induce this tipping expectation which eats into what gamblers actually take home.

I would understand tipping if you had the option to go up to a counter and process everything yourself, where the to-your-seat paperwork and payment is a convenience. But here you have no choice. To me it feels like tipping the DMV clerk for processing my drivers license renewal, or tipping a bank teller for handing me my own money when I withdraw it.

[SLaPiNFuNK]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

[MisterV]

Did you sue the tax guy?

If not, why not?

If he's legit he should have insurance to cover it.

[MaxPen]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

[Dan Druff]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

If it was in the past 3 years, you still have a chance to go back and amend it, and get the IRS to send you the money.

Calling the IRS, while sometimes frustrating to get through, is also effective. They have real accountants answering the phone, and are empowered to help you. In every telephone correspondence I've had with them, I've been impressed, and I've gotten various issues solved much quicker than trying to write back and forth.

You can also get them to forgive interest/penalties if you have a reasonable story, and are willing to pay up otherwise. In fact, I advised someone else recently (a friend not in poker/gambling), who didn't know an obscure tax law, and ended up underpaying. He got hit with interest/penalty, and I told him to call the IRS, explain the circumstances, offer to fully correct the error, and ask for the penalty/interest to be waived. They agreed.

[Mission146]

This has certainly been one of the more interesting tipping threads.

One of the posts here led me to contemplate a perspective that I hadn't---were it not a slot attendant, 'Handpay,' how much would you tip the cage if you could take the ticket there? The high limit machines where the PC will allow you to accumulate W2-G winnings aside (which are relatively new), it's not as if the handpay is an optional service and, in fact, detracts from the experience as the machine has to be temporarily shutdown and then you have to wait for your money.

I'm actually reevaluating my earlier position on handpays and now thinking it's probably imprudent (unless you specifically have a reason to want to be liked at that house) to tip attendants more than you would tip the cage. If I ran up a $2,000 ticket (without handpays), for example, then I'd probably give the cage guy $5.00, but would more likely cash out at one of the stations when it allows for that much. (I could be wrong, but I believe I recall one casino where the cash out machines wouldn't allow for a single ticket over $1,500.)

[jdog]

Server wages should be banned in every state

I agree... it's leftover prohibition era nonsense.

The problem is we have certain professions where tipping has become customary, like valets or people that handle your bags. Certainly it is in your best interest when people are handling your property. I usually only tip at the cage if I'm making them do a lot of work, like changing bills or giving them a bunch of tickets at once.

The worst thing is how employers are abusing the tip function to guilt you into giving the person who hands you a sandwich another 20%, essentially supplementing what should be a normal wage. No reason to tip if there is no service to tip on, I tend to think a person processing a handpay falls more into this category.

[SLaPiNFuNK]

Did you sue the tax guy?

If not, why not?

If he's legit he should have insurance to cover it.

I didn't think about it. Is that a thing could I have done that? Tax year was 2016, filed late 2017...

[SLaPiNFuNK]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

Did file an amended return. They said I could not file an amended return to reduce the balance. Remember, I already filed my losses as XXX,XXX, this would increase my losses by 100K something on the amended return. They would also only accept the amended return if I paid the balance, so I paid the balance and then they said, too bad so sad the amended return will not reduce the amount you owe.

The loss number was basically against the w2g's that we had since he said that the loss can not exceed the winnings because then they would wonder where that money came from etc...

[SLaPiNFuNK]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

If it was in the past 3 years, you still have a chance to go back and amend it, and get the IRS to send you the money.

Calling the IRS, while sometimes frustrating to get through, is also effective. They have real accountants answering the phone, and are empowered to help you. In every telephone correspondence I've had with them, I've been impressed, and I've gotten various issues solved much quicker than trying to write back and forth.

You can also get them to forgive interest/penalties if you have a reasonable story, and are willing to pay up otherwise. In fact, I advised someone else recently (a friend not in poker/gambling), who didn't know an obscure tax law, and ended up underpaying. He got hit with interest/penalty, and I told him to call the IRS, explain the circumstances, offer to fully correct the error, and ask for the penalty/interest to be waived. They agreed.

Tax year 2016, got the bill in 2018 sometime... I paid some bullshit tax law group $5000 and they were useless. Said nothing we could do after they rejected the amended returns.

Pretty fucked up the whole thing...

[Don Perignom]

Pretty fucked up the whole thing...

[MaxPen]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

Did file an amended return. They said I could not file an amended return to reduce the balance. Remember, I already filed my losses as XXX,XXX, this would increase my losses by 100K something on the amended return. They would also only accept the amended return if I paid the balance, so I paid the balance and then they said, too bad so sad the amended return will not reduce the amount you owe.

The loss number was basically against the w2g's that we had since he said that the loss can not exceed the winnings because then they would wonder where that money came from etc...

It all boils down to you having screwed up records. That's kind of what I thought. If you're going to fabricate numbers to correlate to w2-g wins then, yeah, you best not miss any. Your accountant is wrong about the loss not being able to exceed the win. You can have whatever losses in your case you just wouldn't receive any credit for them above offsetting wins.

I always recommend reporting wins and losses at 115-120% of wins for which you have records for this very reason, if someone is just making up numbers. Just in case something like this happens.

[regnis]

I had a tax year where my former tax guy neglected to look up my w2g's that were reported to the IRS. I didn't keep track and had 120K of unreported w2g's that year.

Long story short, we filed, reported my losses against the w2g's I actually had. Year later I got a bill for something like 36K plus interest and penalty. Even though my win loss statements did not show a profit, they still hit me for the full taxable amount on the wins even though they were not actually "wins." Tax people don't understand how gambling works. Because I didn't account for those w2g's and report the appropriate losses against them, I got stuck paying the bill...

That tax guy really fucked me... Now I make sure I get a report from the IRS before filing my taxes...

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

Did file an amended return. They said I could not file an amended return to reduce the balance. Remember, I already filed my losses as XXX,XXX, this would increase my losses by 100K something on the amended return. They would also only accept the amended return if I paid the balance, so I paid the balance and then they said, too bad so sad the amended return will not reduce the amount you owe.

The loss number was basically against the w2g's that we had since he said that the loss can not exceed the winnings because then they would wonder where that money came from etc...

Just an FYI. You never have to pay the liabilty to file an amended return. It is not Trump's bond.

[accountinquestion]

The worst thing is how employers are abusing the tip function to guilt you into giving the person who hands you a sandwich another 20%, essentially supplementing what should be a normal wage. No reason to tip if there is no service to tip on, I tend to think a person processing a handpay falls more into this category.

It is actually worse than this. In some states the employer only has to make up what tips didn't cover. So if after tips they make $5/hr ($2 +$3 tips) but they're guaranteed $7 by minimum wage - then what you tip is effectively going into the owners pocket. Incredible. Stuff like this gets started and people don't care enough to fix it so it is abused forever going forward. Nicer people subsidizing everyone else. (Or at least the paranoid)

You see this with pooled tips. The people pick up the tips and give them to their manager person. Buffets and such.

If it is a cheaper place and counter service then I tip 10% now. Maybe more if a really cheap place and especially if cash.

To some degree I believe the waitstaff doesn't care much about the tips. When you click "tip" there is no indication who it goes to .. like a foodtruck where employee can't take cash. She isn't even likely to be legal. Why should I seriously think the tip is going into her pocket? Yet I feel obligated to do it so she won't fuck with my food somehow. Then we don't even know if she gets it.

I've been lowering my tips greatly. At cheap places where waitresses clearly aren't making as much I can tip 25-50%. So much is counter service though and can't even use cash...

[accountinquestion]

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

Did file an amended return. They said I could not file an amended return to reduce the balance. Remember, I already filed my losses as XXX,XXX, this would increase my losses by 100K something on the amended return. They would also only accept the amended return if I paid the balance, so I paid the balance and then they said, too bad so sad the amended return will not reduce the amount you owe.

The loss number was basically against the w2g's that we had since he said that the loss can not exceed the winnings because then they would wonder where that money came from etc...

It all boils down to you having screwed up records. That's kind of what I thought. If you're going to fabricate numbers to correlate to w2-g wins then, yeah, you best not miss any. Your accountant is wrong about the loss not being able to exceed the win. You can have whatever losses in your case you just wouldn't receive any credit for them above offsetting wins.

I always recommend reporting wins and losses at 115-120% of wins for which you have records for this very reason, if someone is just making up numbers. Just in case something like this happens.

AFAIK you can see all your w2gs on the IRS website these days so this sort of thing shouldn't really happen. I'm not even sure what particular value would be in keeping the physical W2-Gs for this reason.

[SLaPiNFuNK]

Why would you not amend your return instead?

Did your tax guy just pull a loss number out of nowhere against the w2-g's he had access to?

Did file an amended return. They said I could not file an amended return to reduce the balance. Remember, I already filed my losses as XXX,XXX, this would increase my losses by 100K something on the amended return. They would also only accept the amended return if I paid the balance, so I paid the balance and then they said, too bad so sad the amended return will not reduce the amount you owe.

The loss number was basically against the w2g's that we had since he said that the loss can not exceed the winnings because then they would wonder where that money came from etc...

It all boils down to you having screwed up records. That's kind of what I thought. If you're going to fabricate numbers to correlate to w2-g wins then, yeah, you best not miss any. Your accountant is wrong about the loss not being able to exceed the win. You can have whatever losses in your case you just wouldn't receive any credit for them above offsetting wins.

I always recommend reporting wins and losses at 115-120% of wins for which you have records for this very reason, if someone is just making up numbers. Just in case something like this happens.

Filing as self employed with a business that also reports a lot of expenses, I get a lot of grief about expenses being believable or not. I have records for everything but it is a 7 figure business. He reported as much as he could without throwing up flags he said...

It's over... I don't work with him anymore... I overpaid the IRS and the whole situation sucks...

Good news is I won't do that again.

[smurgerburger]

I have experienced, and know several others who have experienced, the same thing with the IRS.

You can actually contest it successfully by argument, as I did.

But going forward the better approach is to declare a net win equal to (or above as Max suggested) the W2G amount, and then whatever you need for the loss.

Of course if you're not filling as a professional and you were planning to take the standard deduction you're going to lose that.

[MisterV]

Of course if you're not filling as a professional and you were planning to take the standard deduction you're going to lose that.

I'm a recreational gambler and do not file as a professional and I itemize as opposed to taking the standard deduction so that I can offset all wins against losses.

The amounts at stake make it worthwhile not to take the standard deduction.

[accountinquestion]

I have experienced, and know several others who have experienced, the same thing with the IRS.

You can actually contest it successfully by argument, as I did.

But going forward the better approach is to declare a net win equal to (or above as Max suggested) the W2G amount, and then whatever you need for the loss.

Of course if you're not filling as a professional and you were planning to take the standard deduction you're going to lose that.

Meaning you didn't declare enough losses to cover your W2G wins?

[smurgerburger]

I have experienced, and know several others who have experienced, the same thing with the IRS.

You can actually contest it successfully by argument, as I did.

But going forward the better approach is to declare a net win equal to (or above as Max suggested) the W2G amount, and then whatever you need for the loss.

Of course if you're not filling as a professional and you were planning to take the standard deduction you're going to lose that.

Meaning you didn't declare enough losses to cover your W2G wins?

Correct.

ETA I misread your posts. Meaning my declared gambling win was less than my total w2g amounts.