I've wondered about this in the past....maybe someone here can tell me.....I assume that when the pros win money in tournaments, that they have to report the winnings as earned income (no matter how much?), but what about those who win money that are not listed as professionals? I'm referring to those tournaments that have relatively large payouts, like maybe $2000-3000 or 3500 for 1st place? Are tournament directors required to withhold money from winnings for the IRS?
tax?
- Thread starter wahcheck
- Start date
lukeinva
Banned
wahcheck said:
No its your responsibility to report that to the irs. Your suppose to report everything to the IRS so the can get thier grubby little hands on more of your money!!! Of course you dont have too but then if for some reason they pick you to audit and you only claim you make 25k a year and you have a dodge viper sitting out front of the house that you paid for with your pool winnings your going to end up owing back taxes and most likely be sued for tax evasion!
lukeinva said:
You can deduct pool related costs though.
well you might can deduct your pool costs. For instance, if pool was youre profession, youre main source of income, then yes your necessary pool expenses would be deductible from your pool income. If you just play pool as a hobby and happen to win......the money is taxable, but the expenses would only be deductible on youre schedule A if you are able to itemize, and they would be severely limited.
as far as tournament directors withholding taxes, the only way i see that happening is if they are directed to do backup withholding on people they have paid in the past........for example when you pay people then turn it in to the irs on your form 1099.........the irs can send you a thing saying "hey next time you are gonna pay this guy, hold out 28% of it and send it to us" this is known as backup withholding.
and yes im an accountant
as far as tournament directors withholding taxes, the only way i see that happening is if they are directed to do backup withholding on people they have paid in the past........for example when you pay people then turn it in to the irs on your form 1099.........the irs can send you a thing saying "hey next time you are gonna pay this guy, hold out 28% of it and send it to us" this is known as backup withholding.
and yes im an accountant