Question of the Day - 22 December 2020

If you hit a natural royal flush on a 100-play video poker machine, for tax purposes is that counted as 100 separate payouts that do not need to be reported, or is it one big payout that must be reported?

If you're dealt a royal flush on a Hundred Play video poker machine, you're issued a single W-2G. In fact, all line winners on one "play" of a multi-line machine are totaled together and are considered one "hand."

For example, Brad Scott, Jean Scott's husband, was once dealt a royal while playing a quarter Hundred Play machine. His jackpot? $100,000. His W-2G? $100,000.

Note that the IRS requires you to report all winnings. This is true whether you receive tax paperwork or not. This doesn’t mean that if you cash out more than $1,200 on a slot of VP machine after a period of play, you have to be issued a W-2G. It’s required only for the win of $1,200 or more on one hand or spin.

Gambling and taxes is complicated and fraught with built-in pitfalls and most accountants, tax preparers, and even the IRS itself get it wrong. To get it right, you need Tax Help for Gamblers, 4th Edition. The $18 you spend on the book will save you money, hair (that you won't have to pull out), and possibly the dreaded audit. 

Why do blackjack dealers clap their hands once or twice when they turn their table over to another dealer?

This is known as "clapping out." It's an old ritual that has to do with showing the eye-in-the-sky that dealers aren't palming any chips as they leave the table. They're not really clapping; it's more like wiping something from one hand with the other, so anything that might be in one of their hands will get pushed out.

Do casinos allow players to use blackjack strategy cards at the tables?

Using a blackjack strategy card (as well as video poker strategy cards) is tolerated by most casinos. Nearly every blackjack game that casinos deal has an advantage over basic strategy play, so even with a strategy card and perfect play, the casino will grind its little percentage out of you, hand after hand, hour after hour, shift after shift. That's why they allow you to use the cards. The main concern when you use one is that you don't hold up the pace of play unreasonably. In cases where a player is taking an inordinate amount of time consulting the card, the casino may ask you to put it away.

You can usually buy basic strategy cards in gift stores for a couple bucks. They're rarely exact, but usually close enough to approach perfect basic strategy play. The most accurate basic strategy cards are those by Don Schlesinger.