A little tax help please

My husband won $750 at LVH from a slot tournament a couple of months ago. He filled out some IRS form before he could get his cash. Apparently he forgot to put in any Social Security number. He just received a certified letter from LVH with a W-9 form to complete and return to the LVH. No taxes were withheld.

Is the W-9 probably the same form he filled out at the LVH?

Will he also receive a W2-G from LVH?

He won't receive a W2G, but he will receive a 1099. You can't use gambling losses against a 1099, unfortunately.

I believe you will get the W2G when they get the social sec #. To balance the win against losses for taxes you must have your own spreadsheets of previous trips showing wins AND losses, or the IRS agent can "estimate" your wins. The IRS agent does accept your self generated wins and loss report (best spreadsheeted).

Do not use casino yearend reports of your play. This just ads confusion to the taxes. There is currently NO "generally accepted" accounting proceedure from casinos to report player wins and losses. They are all different (by corporation).

You do not get W2G's from slot tournament or casino drawing "wins" -- you get a 1099 (1099 Miscellaneous Income) for anything $600 or more. Since this is NOT a gambling win in the sense that you place a bet and hit a jackpot, gambling losses cannot be used against a 1099.

This is why it is best to accept free play instead of cash (if they offer that option) since you can run the free play through and whatever you have left will add to your win/loss for the year where gambling losses CAN be used against the win.

Mare is exactly right -- he will get a 1099, not a W2G. The form he signed at LVH probably WAS a W-9, and I'm surprised they didn't catch the fact that he forgot to put in his ss # at the time.

How do you know the slot tournament was free? The OP states "My husband won $750", nothing about whether there was a wager. A form doesn't change the character of the income.

Raisin, your husband should return the form, and might be fined $50 if he doesn't. If he does write something on it and return it, what he writes must be true, under penalty of perjury. It's an official government form, similar to an application for a driver's license, etc.

All tournaments are treated the same, even those that are not free. The winners get 1099's -- not W2G's. Tournaments and drawings are considered to be like "lotteries," not gaming wins.

Thank you all for the information. The letter that accompanied the W9 was titled "FIRST B NOTICE" so when I looked up a W9b it seemed like we needed to do all the reporting for the year and I didn't remember exactly how much he had won in the other tournaments. He usually just got the minimum $50.

If they had just said "we noticed you didn't list your SS # on our form when you won tournament money, please fill out the enclosed W9 and return it to us by..." I wouldn't have felt somewhat threatened.

I like you Sue was surprised it wasn't caught when he picked up the $750.

The LVH tournaments were cash prizes, not sure if we could have asked for free play instead. For 2011 the January and February tournaments give some cash to the top winners and free play for everyone else.

My son won $20,000 cash in one of the tournaments and I'm not sure if that much free play would have been a good thing.

This doesn't matter. A win's a win. If you win a car worth $15K, that's $15K income, the same as cash. If you have income, it doesn't matter who writes it down, where they write it, when they write it, etc. etc. It's income, and it goes on your Form 1040.

LVA members made many good tax points in their comments.

We received a few 1099's this year as Laura won some "drawings" for cash. There was no money wagered, thus regular income.

Laura also received a number of W2G forms for "wins" over $1200. These are deductable from losses in gambling.