Facts
Mark Weil, our client, has been a professional gambler since an undetermined period of time until today. Mr. Weil chose this profession not just because he enjoys to gambling, but also because he believes his gambling winning are tax-exempt. During an undetermined amount of time, Mr. Weil has omitted the income corresponding to his gambling winnings from the gross income on his tax returns.
Issue and Conclusion 1 Is Mr. Weil supposed to include his gambling winnings in his gross income?
Yes, Mr. Weil must include a portion or all his gambling winnings as part of gross income.
Analysis 1
Under Reg. 1.61-1 referring to gross income definition, Mr. Weil must include any type gambling winning in the gross income of the year it was earned for taxation purposes. According to Reg.44.4421-1 gambling income includes but is not limited to
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Weil is not able to prove his profit goal, his gambling activities will be consider a hobby under Reg. 183(c). As a result, under Sec. 165(d), Mr. Weil is allowed to take a deduction based on his gambling losses as a miscellaneous itemized deduction. The rule of the 2 percent floor of the adjusted gross income stated on LTR 200136004 (PLR) will not apply to this type of losses, but the maximum amount of the deduction allowed will be limited to the extent of the gambling winnings earned during the taxable year. Any remainder gambling winning will be fully taxable as part of the gross income. Under IRS Publication 529 [2013], gambling winnings must be totally reported as other income even though the amount of losses equals the total winnings. In addition, Under Reg. 1.6001-1(a)(e), Mr. Weil is required to keep on his records all support of all supporting documents of gambling losses such as losing tickets, and receipts on order to provide appropriate substantiation in the case of an IRS audit. Otherwise, gambling losses deduction will be disallowed. Gregory Alberico, 70 TCM 1320(1995), T.C. Memo
Michael Moscherosch was born on November 23rd, 1962, in Stuttgart Germany. He and his younger brother were born into a working class family, with his mother working as a full-time accountant and his father working as a car mechanic. The Moscherosch family stayed in Stuttgart for since its inception, the families ancestral roots stem as far back as the 1600s and stayed within Stuttgart and the villages surrounding the area. Michael as a child was described to be scholastic and performed well in his school. In Germany, instead of there being an elementary, middle, and high school, there is a primary school and then secondary schools prioritizing certain fields; some of these fields include engineering, trade schools, and “gymnasiums” which closely represent the structure of our American high schools. Upon completing his secondary school education, Michael began studying Chemistry at the University of Stuttgart, working at night during the week to fund his education.
John Culhane reports that DraftKings employee Ethan Haskell has taken unfair advantage of the information he receives as an employee. As an employee of DraftKings, Haskell is justly forbidden from participating in DraftKings fantasy contests. However, there is nothing stopping him from entering contests in FanDuel, which functions under a system very similar to DraftKings. On September 27th, Haskell revealed that he had insider information, and that he was the “only one with this data.” With this data, Haskell outscored over 220,000 people in a contest that week and brought home $350,000. Culhane reports that many at DraftKings make more money on FanDuel contests than from their own salary. This is absolute corruption. Hundreds of thousands of people are losing their money to people who should not be allowed to participate in the contests. This calls for more regulation and the banning of employees from playing in their competitor’s contests. Many believe that those who work for one of the companies do not have an unfair unadvantage. Rather, they are just very knowledgeable in fantasy football and, after working with the game constantly, know the smartest way to play the game. This logic, however, is wrong. The evidence of Haskell beating out over 220,000 participants cannot be a coincidence. The corruption of FanDuel and DraftKings employees using insider information is one reason why daily fantasy sports need to be regulated; regulation will secure safety and fairness for all
In her first publication, “Against the Odds, and Against the Common Good”, Gloria Jiménez tries to convince the readers that the lottery business is urging people to gamble. The thesis is apparent in the first paragraph: “Still, when all is said and done about lotteries bringing a bit of excitement into the lives of many people and bringing a vast amount of money into the lives of a few, the states should not be in the business of urging people to gamble” (118). The author successfully presents valid arguments to support her opposition to state-run lotteries throughout the essay; whether the evidence will properly convince most readers the way she wants them to, is questionable. Although the valid arguments and evidence Jiménez provides is adequate for the essay, I believe only one argument really stands out to convince her readers the purpose of the essay.
Gambling can have adverse effects on the social welfare of many individuals and families. Gambling can increase the number of individuals and families dealing with gambling addiction and exploit individuals and families who are economically disadvantaged. Under such circumstances, not all forms of gambling should be legalized. This is clear evidence that gambling revenue allocated for Texas schools is not worth the negative effects associated with gambling. Education is a valuable source of growth for all citizens in a community, no one in society can truly grow if one part of society is left
The following two paragraphs are a summary of Gloria Jimenez's essay Against the Odds and Against the Common Good. States should neither allow nor encourage state-run lotteries. There are five major arguments that people use to defend lotteries. One is that most lotteries are run honestly, but if gambling is harmful to society it is irrelevant to argue if they are honest or not. The second is that lotteries create jobs, but there are only a small handful of jobs that would be eliminated if lotteries were put out of business. Another argument that would support keeping lotteries is that, other than gambling addicts, people freely choose to buy lottery tickets. This is true, however, there are misleading advertisements that may cause people to buy tickets under false pretenses.
After a few days of smoke inhalation, large volumes of beverage consumption, and the proverbial and literal beatings you received from slots and poker tables, you begin to rethink your version of paradise. All hope is not lost, though; the NFL playoffs are on and your team is about to start. Hoping to salvage what little dignity and money you have left, you grab your favorite team's jersey and head to the casino's sports book. Back straight, chin up, you make your way to the counter and place a wager: "$300 on the Steelers, please."
For years, casino gambling was portrayed in the media and Hollywood as being associated with criminal activities and the mafia. Now with proper scrutiny and government regulations, casino gambling has become a lucrative business, with casinos stock even trading on Wall Street. Casino gambling is an increasingly popular and legal activity in many states throughout the United States. “The term gambling or ‘gaming’ as the industry calls it, means any legalized form of wagering or betting conducted in a casino, on a riverboat, on an Indian reservation, or at any other location under the jurisdiction of the United States” (National Gambling Impact Study Commission Act). States that allow casino gambling benefit vastly by re-incorporating the taxation of commerce gained from casinos and tourism associated with the casinos back into the state and local communities.
The adrenaline-rushing feeling of gambling offers people the idea that opportunity lies within their hands. Unfortunately, there are far too many consequences to gambling to even begin to count. To win you must play, and to win big you must play big. As more gamblers can recall their losses rather than their winnings, gamblers are often dealt with poor hands and must play the risky game to stay alive. Even though gambling has so many faults, some still fall under its corruptions because of gambling’s deceiving fallacies.
"Gamblers Anonymous: Q and A." Gamblers Anonymous Official Home Page. Web. 12 May 2011. .
Maxi Chambers, a former gambling addict, recalled a personal life story about winning five hundred dollars her first time gambling in her article “What I Lost Gambling.” She stated this event led to an uncontrollable need to gamble more frequently every week. In a compulsive gambler, the high from winning overpowers the disappointment from losing. This causes him or her to forget how much money has been lost and focus on trying to win
From the time the Europeans first landed on the Atlantic shore, lotteries have been a part of the American society. According to Will Spink, most states are currently operating a state lottery despite its bleak history in the U.S. (Spink 1). Since 1983, North Carolina has introduced lottery bills in the legislature every year (NC Christian 15). North Carolina Governor, Mike Easley, favors a lottery for increasing revenues for education (Analysis 2). However lucrative state lotteries appear on the surface, they create even more moral and financial difficulties for citizens, and this should encourage states to look at other means of resources instead of legalized gambling.
“She knew gambling could lead to trouble, so she set strict rules for herself. No more than one hour at the blackjack table per trip.” (pg 247, Angie couldn’t control the impulse to gamble even though she knew that her gambling was hurting her loved ones. “Years later, after she had lost everything and had ruined her life and her husband’s, after she had thrown away hundreds of thousands of dollars and her lawyer had argued before the state’s highest court that Angie Bachmann gambled not by choice, but out of habit, and thus shouldn’t bear culpability for her losses, .....
Gambling involves taking a risk. It’s something that gets our adrenaline pumping. Believe it or not, money is one of the major things that makes the world go round and some of those believe that money does indeed buy happiness in our lives. We all have heard the stories of those who have won thousands to even millions of dollars just by gambling and we instantly think that could be us. If some random person can be that one in a million, surely I can be too, right? Even though gambling is a fun thing to do, it is important to be aware of the kinds of gamblers that exist in today’s society and realize that gambling should be played in moderation. For instance, some variations of players include: The Social Gambler, The Professional Gambler, and
As previously mentioned, the issue at the center of the controversy or debate is morality or ethics. Morality or ethics has been at the heart of controversies regarding gambling because some people consider it as unethical. The consideration of gambling as an immoral act is largely attributed to religious beliefs and stigma of obtaining money relatively for nothing. Moreover, the ethical dilemmas and concerns associated with gambling is brought by the emergence of problem gamblers who account for nearly 2.1 percent of total number of gamblers (Kannon, 2012). Therefore, ethical concerns and dilemmas in gambling are fueled by the inherently sinful attitude about the activities, which generate a classical ethical problem from an individual level
Jackson, S. (1948). The Lottery. In X. J. Kennedy, D. Kennedy & M. Muth (Eds.), The Bedford guide for college writers (6th ed., p. 257). Boston, MA: Bedford/St. Martin’s.