Missed the beginning.
The biggest new information that I got was that they are trying to get the tax treatment changed since the tax code was written without taking online poker into account (multi-tabling, more sessions, etc.).
If you are not a professional poker player your gross winnings count as income, while losses count as deductions, maybe. The IRS expects you to track each session separately. You are suppose to add up all your winning sessions, and then your losing sessions. Losses you can deduct can't exceed your winnings.
If you win $1,000. Then you play again and lose $1,500. The win is gross income. If you want to itemize your deductions, you can claim $1,000 (not $1,500) on Schedule A. If you don't itemize, you can't deduct your losses at all.
I was thinking that most players probably don't follow the IRS guidelines and probably just claim the net totals for the year. (I know I don't.)
If you play a lot of sessions, the gross income could become quite large and affect things like your medical deduction, mortgage interest deduction, etc.
If you have a losing year, you can't carryover losses either like you can with investment losses.
http://www.irs.gov/publications/p529/ar02.html#en_US_publink100027003 (bold is mine)
You cannot reduce your gambling winnings by your gambling losses and report the difference. You must report the full amount of your winnings as income and claim your losses (up to the amount of winnings) as an itemized deduction. Therefore, your records should show your winnings separately from your losses.
Diary of winnings and losses. You must keep an accurate diary or similar record of your losses and winnings.
Your diary should contain at least the following information.
The date and type of your specific wager or wagering activity.
The name and address or location of the gambling establishment.
The names of other persons present with you at the gambling establishment.
The amount(s) you won or lost.
Proof of winnings and losses. In addition to your diary, you should also have other documentation. You can generally prove your winnings and losses through Form W-2G, Certain Gambling Winnings, Form 5754, Statement by Person(s) Receiving Gambling Winnings, wagering tickets, canceled checks, substitute checks, credit records, bank withdrawals, and statements of actual winnings or payment slips provided to you by the gambling establishment.