Tax on slot win?

So I was playing a electronic craps game.. I put 1100 dollars in as my buy in. 100 on the pass line.. 400 in odds

So total bet was 500. The 5 hit which gave me 600 dollar winner on my 400 dollar odds bet. And the pass line

Netted me another 100. So total win was 700 for a 500 total bet. The machine locked up and said hand pay..

Has happend before... This time they said I owed taxes! How could this be? Pretty sure it's 1199-1 before taxes no? I would have had to win 60k on that roll to pay taxes? Any and all help is welcomed. Thanks Brayden.

The casino said the 500 dollar bet plus the 700 dollar win is 1200 that's why I have to pay taxes! This can't be right can it?

$1200 payout requires a tax form. You could have asked only for the $700 winning payout. You will only pay taxes if , at the end of the year, you show gross winnings. Your losses should cover you.

I believe they are in error. Here are the rules:

Reportable Gambling Winnings
Report gambling winnings on Form W-2G if:
1. The winnings (not reduced by the wager) are $1,200 or
more from a bingo game or slot machine,
2. The winnings (reduced by the wager) are $1,500 or more
from a keno game,
3. The winnings (reduced by the wager or buy-in) are more
than $5,000 from a poker tournament,
4. The winnings (except winnings from bingo, slot machines,
keno, and poker tournaments) reduced, at the option of the
payer, by the wager are:
a. $600 or more, and
b. At least 300 times the amount of the wager, or
5. The winnings are subject to federal income tax
withholding (either regular gambling withholding or backup
withholding).

[EDIT] You may have just made another good argument against playing the electronic games (on another thread on this board).

Roulette Man. I don't follow. Is it because I didn't win 300 times my wager? If not could you state why you think they are in error please.

When I hit my $1199 royal in Laughlin, it was explained to me that they would only handpay the $1199. I had to play at least one more hand before cashing in the money I had left in the machine. They said it could be a nickle or a quarter, but if the payouts were together, it triggered a tax form.

Billryan what was your original bet?

It's BS, but electronic table games are classified as slot machines and slot machines count your initial bet as a win. That's why the payouts are listed as 2 for 1 instead of 1 to 1 like in table games.

You have to be very careful when playing these electronic games to avoid a W2 because of this rule. If you bet $300 on an electronic blackjack machine and double down you'll get a W2 on a win. It counts the $600 bet and $600 win as a $1200 payout.

$1.25.
Its the payout that matters, not the win.

Bill you hit that 1199 to 1 bet that's why you had to pay..