The fruit machine at Circa on Thursday, May 19, 2022, in Las Vegas. (Las Vegas Review-Journal)Congresswoman Dina Titus speaks prior to President Joe Biden takes the stage about reducing prescription drug expenses throughout a speech in the UNLV William F. Harrah College of Hospitality building on Wednesday, March 15, 2023, in Las Vegas. (L.E. Baskow/Las Vegas Review-Journal) @Left_Eye_ImagesCongresswoman Dina Titus shows up to speak before President Joe Biden talks about decreasing prescription drug costs during a speech in the UNLV William F. Harrah College of Hospitality building on Wednesday, March 15, 2023, in Las Vegas. (L.E. Baskow/Las Vegas Review-Journal) @Left_Eye_Images
Imagine sitting at your favorite slot machine inside your favorite local gambling establishment when the huge one hits.

The whistles and bells go off, the lights pulsate and individuals you don't even know surround you with congratulatory pats on the back and high-fives.

It should be a wonderful feeling - - one I've never ever experienced.

A gambling establishment worker is summoned to pay your prize payouts, and it hasn't even struck you that before you walk out the door with your jackpots, you'll require to square up with the Internal Revenue Service.

Before you even entered a gambling establishment and place your money into the makers, it's wise to establish a technique to keep as much of that money as possible from the IRS.

A number of weeks back, I reported that Rep. Dina Titus, D-Nev., is leading an effort to increase the prize threshold from $1,200 to $5,000 as the minimum quantity required to report payouts to the IRS and get a W-2G type from the gambling establishment. After that column released, I received several emails from readers requesting details on what to do to secure themselves from the tax collector need to the big jackpot hit.

I reached out to Dan Randle and his better half, Paula Mills, of Dan Randle and Associates, a Las Vegas-based company that advises people on tax collection issues and IRS audits.

Randle, a previous IRS agent in Southern California, has seen things from both the viewpoint of the player and the tax collector and was kind adequate to be talked to during the extremely hectic tax season, with returns due April 18.

Most people understand that while gambling establishment earnings are thought about personal income and should be reported to the IRS, the total amount of casino losses can be deducted from payouts to calculate the total tax burden.

So how exactly do you do that?

Get a commitment card

The very first piece of suggestions from Randle and Mills is to be sure to register for the gambling establishment's loyalty club program and use the card whenever you play.

Sure, you'll get all the company's advertising teasers, and it can be unnerving to know someone out there knows how much you take into a fruit machine regularly. If you hit the huge one, you'll be grateful for having actually signed up.

" If players are getting involved or continuing to take part in one gambling establishment or in one of the chain gambling establishments, then they ought to be registered to a player's card or alert a pit manager or manager who understands how long they've existed," Randle said.

" If they deal with a player's card, it's simple to find out what was gambled."

" That's the details they must be supplying their preparer at the end of the year," said Mills, a signed up agent. "When they put that on their Schedule A or nevertheless the preparer files it, they have a great record of losses and wins. They do not just make a guess. The IRS is going to search for that documents."

Withhold 35 percent to 40 percent

Randle stated when a jackpot hits, a gambling establishment worker will circle back with paperwork to ensure the IRS gets its rightful share.

" Most gambling establishments will keep a very precise record because they wish to be able to service their customers," he said. "But they'll typically ask the concern: How much do you want to keep? That's the incorrect question. That's because at the end of the year, if an individual has actually won $300,000 - - or whatever the number - - and they do not keep the proper quantity, they're going to get stuck down the road with a tax expense."

He said if you ask 10 different consultants, you'll get 10 different answers on just how much to withhold. His suggestion: a minimum of 35 percent of earnings and up to 40 percent.

" It's going to make a little bite (of the prize) to do that initially, but it'll save a bigger bite down the road," he said.

Paper trail

When playing table games, Randle recommends turning the card over to a pit manager so that the length and level of play can be kept an eye on. That can be available in handy should a gamer score a huge table win.

For sports bets, keeping track of wagering deals is easy since the casino issues a bet slip on every wager. Randle warned that the IRS is careful of individuals who gather losing tickets and try to utilize them to justify gambling losses.

" When I was with the IRS, we would decline a ticket with a footprint or mustard on it," Randle said.

If a player wins and hasn't been using a loyalty card, the IRS will still accept entries in a journal explaining the amount of money wagered, the date, time and place of play and all payouts as well as losses.

Developing a constant pattern of play can likewise be handy.

Mills said she had a customer who consistently withdrew money from an ATM in a casino and tracked all ATM costs as well as the withdrawals. When it came time to submit an income tax return, the player, an off-duty gambling establishment worker, held all the ATM receipts to validate losses versus wins.

" He provided his bank statements that showed that when he finished work every day, he withdrew a number of hundred dollars, he paid the fee at the ATM where he worked and we provided bank declarations for 12 months due to the fact that one year was under scrutiny," Mills stated. "We had his journal. He didn't have a gamer's card, although he operated at that gambling establishment. We were able to show he paid an ATM charge which it was at an ATM at the properties of where he was playing and a constant amount for practically a whole year which was subtracted."

" It helped that he withdrew the very same amount from the ATM all the time. We want we might get a half-dozen more clients like that."

Randle stated he dealt with a gambler who liked to bank on horse racing. He said every losing ticket he had was neatly stapled to that day's racing kind, which showed the date and time of the race, the track and the number and names of the contending horses.

Randle and Mills said tax problems involving locals of foreign countries are a little more complex because not every country has a taxation arrangement with the United States and exchange rates occasionally enter play.

He recommended that international players understand their nation's tax collection status before starting play.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.