So he managed to win at less than 50% odds.
I assume that in selling his USA home (or some other means?) he hopefully established no residency? or residency where there is no state or town income tax so its just federal (unless he became a canadian or something). We know that for >$5000 it would be submitted to the IRS.
So he A) spent 100k won 200k taxed on 200k B) bet 100k won 200k taxed on difference of 100k or C) bet 100k won 200k taxed on 200k and got a percentage itemized deduction on 100k loss?
If he had in addition earned $40k working that year he is in a high tax bracket. What was his net worth after taxes?
2006-09-25 08:57:47 · 2 answers · asked by grayconstruct 1 in Business & Finance ➔ Taxes ➔ United States
He is still legally a resident of the locality in which he last lived, or of the locality in which he placed the bet.
For federal tax purposes his winnings are the difference between the bet and the payout. To determine taxes, more information is needed. You gave no information relating to possible deductions. In addition, I'm sure he would be subject to the Alternative Minimum Tax. I bet I'm not the only one in this forum that knows little or nothing about AMT.
2006-09-25 15:38:39 · answer #1 · answered by STEVEN F 7 · 0⤊ 0⤋
$2,500 is the minimum for a Casino to report gambling winnings to the IRS. The casino handles all of this by handing the winner a 1099 form. If the winner is a US resident, he has to declare the income on the 1099 form when he files his taxes. He will likely have to pay estimated taxes and could even be affected by the alternate minimum tax if he has a lot of deductions.
2006-09-25 16:19:29 · answer #2 · answered by Anonymous · 0⤊ 0⤋