Taxes - How soon before he's caught by IRS?

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Tommycanyouhearme

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I know this kid (and he is a kid) who's a reg at $25/$50 NL at a brick & mortar casino. He's won over $500k in this game since late 2012 and this year (some say he's now close to $1m).

From what I've heard from his friends, he keeps all of his money in a safe deposit box at a bank and pays cash for everything, including a house he recently bought for ~$300k (100% cash). He doesn't deposit a penny in a bank account and has no intention of filing taxes for his winnings. We're all just thinking it's a matter of time before IRS catches up with him. Can he possibly be this stupid to think he can get away with it?
 
BluffMeAllIn

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Just based on the info in your post, could be slim depending on how the house purchase transaction goes down? If was any bank involvment at all which I am sure there had to be something, then something somewhere could very well spark an interest to be looked into.

Technically there is really no way for them to trace the $$ of money he has won however to determine the taxes, granted they could easily tax him on the 300k for the house I'm guessing if there is anyway to track it (however if 100% cash on the house, seems kind of sketchy to me cause at the least the person who owned it before probably had dealings with the bank which could tip off an investigation). Given the purchaser would not have been in the system, ie ever filled taxes etc so money must come from somewhere...

Just my thoughts. Also this is why it rocks to be in canada in this regard, as I could go take a casino for 10mil tell the whole world and never have to pay a dime in taxes :D (dam that would be awsome)
 
dmorris68

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Interesting choice of first post about this "friend" of yours, but I'll play along.

Depends on the casino. He has to cash in/out chips at the cage, and some casinos will ask for tax ID info (although usually for big tourney wins, not sure how many do that for cash).

Modern US financial laws aimed at anti-terrorism and money laundering, particularly post-Patriot Act, require large or suspicious cash transactions to be reported. For example, if you deposit 10K cash or more at a bank, they're required by law to report it to the government. Below that amount, if they are suspicious, they also must report it. While he might able to get around that as far as keeping it in a safe deposit box (other than perhaps a nosy/observant bank employee), you can't do too very many large $$$ transactions like buying a 300K house for cash without running into a reporting requirement or piquing suspicions somewhere.

I would say his clock is ticking. That said, such things tend to be really slow to catch up with people, and probably moreso now that the IRS is under such scrutiny. But when it does catch up, for large sums of back taxes with all the penalties and interest tacked on, it's often a huge amount to deal with. Not something you want to be taking a chance with, IMO.
 
BluffMeAllIn

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Not something you want to be taking a chance with, IMO.

Haha you mean "Not something ""You're Friend"" would want to be taking a chance with" haha.
 
Mr Sandbag

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Tell this "kid" that running from the IRS is pure stupidity. If he's really making that much money, it's not even worth it to skip out on taxes, especially since by the time it catches up to him, he will be facing large penalties, interest, and perhaps even prison time.
 
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Tommycanyouhearme

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He's not a friend of mine but he used to play in our monthly tournaments ($200 buy-in, a mere pittance to him now) before he went off to high stakes cash games. He's an unusual kid who has absolutely no social skills and many consider him to be a total d-bag. The place he plays in is one of the biggest poker rooms in the country so I would think they're keeping tabs on him at the cage when he cashes out. Never played at that level so I wasn't sure what if anything they did.

We just get updates about him every month at our game and hear crazy stories about what he's doing with his $. He goes to the bank and asks for tons of $100 straps and puts everything in a safe deposit box. I'm thinking that alone would raise flags at a bank. Not sure how the house buying transaction went down but I would think he would have had to obtain a bank check of some sort.

I know this is a weird 1st post but this was the site that came up when I googled Taxes/poker. I assure you I'm not trolling.
 
hobonc

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Unless he has a way to launder the money it is just a matter of time. Especially given what sounds like his reckless nature.
 
LuckyChippy

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At the very least he'd have to pay capital gains tax. He somehow at some point earned/found/stole 300k to buy the house which he would have to pay tax on. He won't be getting away with it.
 
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A lot of the big pros in Vegas keep their money in chips and there for impossible to trace and there are box at the casinos.
 
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He is making it too easy...Unless he bought the house in the name of a rich family member, he been already caught, even if he still don´t know it.

Why the hell he bring the money to a deposit box in the bank instead of keeping the chips + US$100 bills in a safe deposit box in the casino?

He could have kind of good odds if he kept the money/chips there and RENT the house, car in US... instead of buying IT. If he want to buy a house he should have consider buying it on Bahamas, Belize, Panama and changing residence to there and avoiding taxes legally instead of risking go to jail.
 
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naruto_miu

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A lot of the big pros in Vegas keep their money in Poker chips and there for impossible to trace and there are box at the casinos.


That would probably have to their B.R to play with at those stakes but not their every-day living expenses, correct, at-least one would think so
 
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bottom line is that tax evasion gets people put in prison . i have filed on my winnings for years and they dont bother me, knock on wood. really would suggest to him that he get his lisense and keep books , ( perhaps a real 1 and an IRS 1) and file. prison is a little different way of life than a pro gamblers.dont think he would care for it much
 
scorpion1367

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A lot of the big pros in Vegas keep their money in Poker chips and there for impossible to trace and there are box at the casinos.
Never bought anything with poker chips,how would that work exactly....lol.......scorp:confused:
 
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Tommycanyouhearme

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He is making it too easy...Unless he bought the house in the name of a rich family member, he been already caught, even if he still don´t know it.

Why the hell he bring the money to a deposit box in the bank instead of keeping the chips + US$100 bills in a safe deposit box in the casino?

He could have kind of good odds if he kept the money/chips there and RENT the house, car in US... instead of buying IT. If he want to buy a house he should have consider buying it on Bahamas, Belize, Panama and changing residence to there and avoiding taxes legally instead of risking go to jail.

The kid's definitely not savvy enough or have the social skills to find out from others on how to go about getting away with something like this. He lives on the tables and knows nothing about life.

Kind of sad actually but he's damn good at poker... Money management is another issue where before he got to this level, he would be up $50k - $100k only to go broke, then get back up, repeat. He kept at it and now he is where he is. He has absolutely no fear of going broke and I guess that's what makes him so dangerous.
 
Propane Goat

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The problem with this whole scenario is that we live in the database age, he might be able to run for a while but he can't hide and when he finally trips, he will be shocked at the amount of bread crumbs that he's left behind.

Like someone said, unless the house is in someone else's name that's already a huge red flag because he's getting all this money somewhere and it's not being reported. The first thing that the authorities tend to think when they see large cash transactions for assets without documentation to prove where that cash came from, is narcotics.
 
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he will be caught eventually the irs will catch up to hit when they catch him he will will be hit with huge penalty and possible jail time
 
naruto_miu

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Never bought anything with poker chips,how would that work exactly....lol.......scorp:confused:



I think for BRM wise meaning they don't actually enter the casino with funds, and only leave with profit, so assume you went to casino with 100k and won a million at high stakes, than leave high stakes with about 300k but keep the remainder there...

At-least that's what I think they talking about
 
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The very real dander for this kid is the large group of people that would hurt him for this cash.

get him a guard.
 
rubenator

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I got caught by the IRS for $4,500 in back taxes that I didn't catch. I'm not exactly sure how it happened still but I wasn't trying to avoid them either.

I guess what I'm trying to say is that "your friend" is going to get caught. Especially when the IRS Flags go off and they start to look at credit information and purchase histories.

The IRS is good at collecting taxes. When you buy a car, house, product, anything, they receive the notification that an item was sold. Your friend didn't pay taxes on the house, but the bank/real estate/owner has to claim taxes on the sale of the residence. The IRS will take the taxes, and then try to figure out who bought it and where they got the money from - just to keep the money trail in check.

Also, why is the Casino not asking for Tax information? THey should be doing that for anything above $9,999.99.
 
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bernotas22

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in my country you can't get taxed for gambling :) which is what poker is, can you seriously get taxed for poker in usa?
 
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in my country you can't get taxed for gambling :) which is what poker is, can you seriously get taxed for poker in usa?

Yes. What country do you live in. Regardless of what people say I'm sure that was the main reason behind black friday, because the government wasn't getting their proper cut.
 
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bernotas22

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Yes. What country do you live in. Regardless of what people say I'm sure that was the main reason behind black friday, because the government wasn't getting their proper cut.

im in lithuania it doesn't really get into taxing gambling, some countries in europe do tax like france, spain, italy, but others like uk, germany, and others i know do not tax, i would say most don't tax in europe though or some others are like canada where you could probably get away with not filing gambling taxes if you have another job, and yes it was one of the main reasons poker was banned in the usa, they did not want to regulate it and tax it like other uptight countries even though most don't and shouldn't do that and don't today, too much money made and if the gov't can't get some of that money they are not too happy about it :)
 
trekmaster

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That is it in a nut shell my friend.The US government couldnt find a way to regulate the winnings and get their share.online poker will/ would be all fine when they figure out how to get the tax monet comming and going.If they dont start WWIII be fore they can figure it out.
 
Fishpicker13

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I'm not 100% about this, but I think if he is not filing, he is not commiting fraud, therefore not risking jail time. He will probably have huge fines, laywer fees, accountant fees, etc. or maybe that would be a good time to travel and spend the money. Just don't try to get on an airplane with a duffle bag of cash. As IRS agents work on a commission-like basis, they'll be tripping over each other to contact him. Wouldn't mind being a fly on the wall for that chat.
 
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wow congrats to him.....he is beating the government ....weeeeeeeeeeeeeeeeee
 
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