Topic: U.S. Taxes on Bitcoin Gambling (Read 1931 times)

I pray they ban it. Gambling should be banned by governments in order to keep their people safe and sound from harm. I do believe that all the senators and government officials do know what is wrong with gambling and even if it is played with crypto that becomes double crime. So legislation should be made and implemented with extreme punishments for their citizens’ safety.

I don't thing you need to get taxed when you lose at wagerring. Taxes are usually paid from your net profit, that means if you lose, you won't be asked to pay tax. There is also minimum revenue to be taxed. Also, loan or your liability is the one that can help you to pay tax less. I don't know if there are any difference law on each country but at least this is how tax works in my country.

I agree that goverment collects tax from crypto profit but only IF crypto business is fully regulated and accepted to be operating, and there is no more restrictions for building bussiness in crypto space.

The law should be the same for all. If someone making money in USD is expected and bound to pay tax on his money, why not the once who makes the same amount of money in Bitcoin ? After all, it is just a different form of money which should not make a difference between the two.

I can see the US has been imposing some strict regulations on the use of cryptocurrency to make sure their economy stays stronger. This may include crypto based gambling too so that both gambling house and gamblers are prompt to taxes.

This is a good point.  I guess people should be aware of this. I wonder if thesame thing applies to most countries.  I have seen some posts accusing people who are getting paid in bitcoin/crypto of not paying taxes and stuff like that.

I understand you think IRS is that much following through power like they used to (I mean after all there is a cliche that al capone went to jail for tax evasion from all things he did) but IRS doesn't posses the power they used to have. To give a better explanation, if you make millions of dollars from Vegas yes you will get caught so you should pay your taxes right away.

Moreover, you gave example of bingo, now in Florida elderly people play bingo all the time and they make money or earn rewards all the time, do you really think an old lady that won a hat from bingo gives IRS the info that she won a hat ? No she obviously doesn't. Same applies with crypto, maybe for something bigger than hat, but in the end if you make millions gambling on crypto you should report it but if you made 700 dollars for example, no one cares, not even IRS.

Now OP, Whether on a weekend in Vegas or watching a football game with our buddies, most of us have won or lost a little money gambling.  But did you know that you must report gambling wins and losses to the Internal Revenue Service? With cryptocurrency-based gambling quickly increasing in popularity, Bitcoin users must be aware of the tax liability imposed on their winnings.
Just like the mafia of old Vegas, the IRS wants its cut after the fun and games are over. Anyone who wins money gambling or wagering must pay taxes. This includes not only typical card games, sports books, and casinos, but also racetrack bets, gameshow winnings, lotteries, and even Bingo.

Gamblers should be aware of the tax rules that apply to gambling income. Regardless if winnings are paid out in prizes, traditional cash, or cryptocurrency, winning bets create taxable income. I. Casinos and gaming sites may withhold these taxes for you. In these cases, they provide gamblers with a Form W-2G, which they use to report how much they won and how much tax was withheld. However, even if you don’t get a Form W-2G, you are responsible for reporting all gambling winnings to the IRS.In order to be sure of which tax rules affect your gambling income, be sure to consult with a qualified tax professional.

It’s critical to keep your records in proper order in case the IRS audits your tax return. The government expects all of us to keep detailed financial records, including gambling wins and losses. So, anyone who gambles using cryptocurrency or traditional money should keep all related receipts, tickets, payment slips, statements, and key tax forms like Form W-2G and Form 5754.
If you plan to deduct gambling losses, you must be able to prove your winnings and your losses. The IRS suggests that you do so using a gambling log or diary, but often online gaming sites like example here Betchain, 7bitcasino , Fortune jack and even my favorite VegasCasino.io provide a detailed history of your activity that can be used for this purpose.

Online gambling using Bitcoin and other cryptocurrencies has increased in popularity over the past few years. In fact, online gaming was one of the first mainstream uses of virtual currencies. As a result, many cryptocurrency users may have tax liability on their gambling winnings and not even know it. If you gamble, you must report your wins and losses on your tax return or else IRS will be knocking on your door very soon .

No its does not work that way  .   tax can be implemented even if you didnt work on a comercial establishments and  i did hear that there will now be tax for online workers or free lancers and that will be planning to approved soon on our country  .

Bitcoin and cryptos should not be taxed because they are not under the regulation of banks and governments . so anything related to it should be excluded in the tax law  .

Taxes go by the location of the client perhaps not by the location of the server hosting hardware.    Gambling is not taxable by people who win in my country but some places it counts as income still,  that part is going to vary.    How they tax a foreign company that has no operation inside the country is not just about gambling, it probably applies to all sorts of questions like google and facebook even

I think China for example wants companies to form a local operation that is partly owned by government because thats how they want everything is my guess

My understanding of taxes is. if we use existing state facilities in some country and making it our business operate then it should addding rules for users and owners to pay taxes to the state. but if pure online is done and does not use facilities in the area, taxes should not be implemented. CMIIW

that's truly correct need to review about the law collecting taxes  from the gambling business and most specially how to collect taxes from the player using bitcoin in online gambling because the player is anonymous identity.

Yes thats it,we need to pay the taxes as investment based earnings when we convert them but if we keep those $100 profits as crypto then we no need to pay any taxes right.

Still, there is not any difference in taxation. You are getting taxed when you exchange your crypto to FIAT. In my country, I think that if for example deposit 100$ and you are to withdraw 200$, this 100$ difference is taxed as investment earnings. You don't have to prove that you gambled this money and you got more. You are been taxed for the amount and not for the usage of it if you see my point.

If we win on gambling sites and keeping them as bitcoin will make us no worry to pay taxes since it is not traceable but when we are trading them or converting them through exchanges you will get recorded by exchange's contract address so you will get caught if you are cheating to pay the taxes to governments.

I don't know how the gambling site works in converting BTC to FIAT through win or lose,my assuming gambling sites usually already have BTC and win or lose already in BTC units.If changing to FIAT is related to trade but if I read your title about US tax,it seems that it was correct right I have time to read some sites related about it.

The question is two parts, do we talk about the casinos in USA or the people who are from USA and gamble on a foreign casino website. Now, I doubt there are places in USA that allows you to open a bitcoin casino, I think it is illegal for people to have online casinos there, last I remember there was a ton of trouble going around about poker websites years ago and most of them got shut down and had to relocate to some offshore country like caracao or something. Hence ever since those times no online casino would prefer USA anyway.

Moreover, if you are from USA and want to gamble that means your taxes depending on your honesty, since USA can't really check your gambling like they do with trading, they will have to rely on your honesty. Exchanges give your information to government so you HAVE TO pay your taxes there but casinos don't give a damn about government so you can not pay a single dime if you don't want to.

750$ is a quite good amount and that too with a single bet as you mentioned so ideally you should be playing with that much amount itself that it is under 750$ winning amount even if you won the bet so that you are not required to pay the taxes. I think btc needs to be the same as US else it would be quite harsh for people who bets with btc.

The problem with US is they want to tax everything, so in order for them to do that, they will find ways to control and one is they will require us to adopt with the rules and regulation and if we fail to adopt then we will face the legal consequences.

Unclear standard law in crypto is the reason why the price is dumping now, people has loss confidence because SEC has not make a move to release a law that would help crypto investors or users, instead, they crack down ICOs, illegal gambling sites using the AML law.

In the US as a citizen even if you leave the country and dont work there, dont receive any income from USA, have no assets there and live for years abroad in another country;  even after all that you will still owe the US Federal government taxes on your income.

This is one of only two countries and the other is a tiny regime that has such a law for foreign citizens.    You literally cannot escape these taxes, exiting as a citizen will also cost many thousands in fees as well as the taxes.    The one alternative I have heard of is to become a registered member of the Federal Territory of Puerto Rico which as it is not an incorporated state does somehow allow them to field no tax liability on you.  You will pay local taxes only.   You must be present in the country for at least half the year and tax is only affected going forward not previous gains

Really? I mean I thought that it was practically impossible to gamble online legally in most states.
Here's a map that shows where it's legal to gamble: https://www.playusa.com/us/

That said, it's not because it's not regulated that the IRS can't tax you. I'd either invest a lot into playing anonymous or report any winnings.

Although US has gone forward with different bitcoin laws I think that when you deposit to a betting site is as if you sold bitcoin at current price and when you withdraw from the betting site is as if you bought bitcoin at current price.

I also think that this is a wrong law and only the betting company should pay taxes and not the end user.