${site.data.firmName}${SEMFirmNameAlt}
Call Us At:
301-637-8130

Do you have to pay taxes on offshore gambling winnings?

You've been playing poker for years. You started when you were a teen, playing with your friends for fun. No money changed hands. You learned the ins and outs of the game, though, and found you were really good.

Then poker blew up. It was all over the television. You started playing more and more at casinos. You began taking trips out to Las Vegas to play in big games and tournaments.

When you found online poker sites, you were in heaven. You didn't have to go anywhere. You could play right from your computer.

Best of all, you don't have to pay taxes, right? The sites you use are all based overseas. These aren't U.S. corporations. The gambling isn't on U.S. servers. The money doesn't come from U.S. sources.

Does that mean you don't have to pay U.S. taxes?

It does not. This is one of the most common misconceptions about online gambling. People think of it differently because it happens on the computer and the companies -- and other players -- aren't Americans. They don't think of it the same way they view playing in Vegas. They assume they don't have to pay taxes, that they earned the money "under the table."

There's no gray area in the U.S. tax code, though. It says that you must pay taxes on money that you earn if you are a citizen of the country. That includes money earned through gambling -- this goes beyond mere poker games -- and it counts money you earn overseas.

There's a bigger picture here, as well. Maybe you never earned the money online. Maybe you physically travel overseas to play poker and do other types of gambling. Then you electronically stash the money in your bank account and head back to the U.S.

You still have to pay. You must claim that money when filing your taxes. It's still income. The government is less concerned with where you got the money -- from a tax perspective -- and more concerned with where you live. If you live in the United States, you're not exempt from taxes.

Some people wrongly assume that they don't have to pay because the money isn't tracked. There's no company filing tax papers with the U.S. government, like you get with your wages.

While that may be true, the IRS can still find that money. It's in your bank account. An audit is going to show that mysterious income. It remains unaccounted for.

As you can see, it's important not to fall prey to myths about the U.S. tax codes. No matter how many times you hear these myths repeated, you must search out the truth and know your real rights and obligations.

No Comments

Leave a comment
Comment Information

Contact the Tax Lawyers at Kundra & Associates

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Get In Touch
  • Best Law Firms U.S. News 2014
  • Best Law Firms U.S. News 2015
  • Best Law Firms U.S. News 2016
  • Best Law Firms U.S. News 2017
  • fortune leading women in the law 2013 & 2014
  • Super Lawyer
  • Best Lawyers 2013, 2014,2015 and 2016
  • Global Law  Experts | 2016 | Annual Awards Winner

Rockville Office
110 North Washington Street
Suite 406
Rockville, MD 20850

Phone: 301-637-8130
Fax: 301-424-7047
Map & Directions

Washington, D.C. Office
1025 Connecticut Ave NW (By Appt only)
Suite 1000
Washington, DC 20036

Phone: 301-637-8130
Fax: 301-424-7047
Map & Directions

Kundra & Associates, PC
C/o Anmol Sekhir Consultants Pvt. Ltd. Chartered Accountants
3rd Floor, Sahakar Bazar
Opposite Railway Station
Bandra (West), Mumbai 400 050

Phone: 301-637-8130
Fax: 301-424-7047
Map & Directions