South Korean Businessman Wins IRS Gambling Tax Case
Posted on: July 11, 2013, 05:30h.
Last updated on: July 10, 2013, 01:15h.
In many nations around the world, gambling winnings aren’t taxed. Others tax winnings only from professional gamblers, or tax gambling winnings at a reduced rate that simply asks for a percentage of net winnings. That’s not the case in the United States, where gambling winnings are taxed (for non-professionals) every time a player wins, and deductions against that amount can be taken on every loss.
For poker players and other gambling professionals, this could be an absurd burden, requiring them to collect information on every single bet they’ve made during the year and submitting that information to the Internal Revenue Service (IRS). That’s why the IRS instead lets gamblers record their net winnings (or losses) on a session-by-session basis, which is likely how most serious gamblers keep their records anyway.
Foreigners Taxed Differently
But this courtesy hasn’t always extended to foreigners, which has led to some harsh demands on those who owed the United States taxes on their winnings. That was the case for Sang Park, a South Korean businessman who found himself in a legal battle with the IRS over just how his gambling winnings should be taxed.
Park won and lost thousands of dollars during his trips to the United States, mostly playing slot machines. According to the IRS, Park had to pay taxes on every single winning spin – a heavy burden for any gambler to face. But Park fought against this ruling, saying that there was no reason that he shouldn’t be able to calculate his wins and losses on a per-session basis, just as American gamblers are allowed to do.
Initially, tax courts ruled against Park. But a ruling this week from the U.S. Court of Appeals for the District of Columbia Circuit found in Park’s favor, saying that his gambling winnings should be taxed in the same manner used to calculate the taxes paid by American players.
Now, it’s simply a matter of figuring out how much money Park will ultimately owe. The case has been sent back to the U.S. Tax Court to make a determination of the final tax bill Park will face based on his session wins and losses.
Related News Articles
Related News Articles
- November 2, 2020 — 14 Comments—
- November 24, 2020 — 12 Comments—
- November 24, 2020 — 11 Comments—
- November 11, 2020 — 10 Comments—