Calling Tax Experts
#1
Original Poster
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Join Date: Aug 2001
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Calling Tax Experts
So I had a very profitable Saturday night at the Lumiere in downtown St Louis, coming home with a couple of w2-g's (slot hit and VP hit).
Missouri withheld 4% of the winnings. Can I get this money back? I'm assuming that my home state will think this income is theirs as well.
Anyone run into this before? Nevada wins are so much simpler!
Missouri withheld 4% of the winnings. Can I get this money back? I'm assuming that my home state will think this income is theirs as well.
Anyone run into this before? Nevada wins are so much simpler!
#3
Join Date: Apr 2003
Location: Silicon Valley, CA
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As ORDflyer is saying, it really depends on your state of residence. As a general rule, you should file a tax return with Missouri as a non-resident and fix your Missouri income tax liability. (With personal exemptions and/or other allowable deductions, you may get all tax refunded by filing Missouri non-resident tax return.) And then, if you still have to pay tax or not all tax were refunded, you file your home state tax return. Generally speaking, most states allows you to take tax credit against your home state income tax liability for the amount of income tax you end up paying to Missouri. Most states allows this type of credit although some state may not allow this. If you are using CPAs preparing tax returns, they should know how. If not, throughly read instructions for state tax returns for Missouri and your home state.
#5
Join Date: Jul 2005
Location: IND
Programs: Marriott Platinum, SWA CP
Posts: 577
Not an expert, but I think you also need to start rounding up your gambling loss statements from anywhere you played this year. Isn't that the only legitimate way to "offset" gambling winnings on your tax return?
Also, congrats on the wins!
Also, congrats on the wins!
#6
Join Date: Feb 2000
Location: Chicago, IL, USA
Programs: AA EXP, Hilton Diamond
Posts: 574
Tax answers
Unless i am misreading, the 4% Missouri tax is non-refundable. Filing a non-resident return won't help you. Indiana will give you a credit up to the Indiana tax on the same income. Indiana will not allow a deduction for gambling losses. This is because the Indiana tax is based on your federal adjusted gross income.
For Federal purposes you may deduct gambling losses on Schedule A as an itemized deduction. This may or may not be of help to you depending on your income level and the amount of other deductions you have.
For Federal purposes you may deduct gambling losses on Schedule A as an itemized deduction. This may or may not be of help to you depending on your income level and the amount of other deductions you have.
#7
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Unless i am misreading, the 4% Missouri tax is non-refundable. Filing a non-resident return won't help you. Indiana will give you a credit up to the Indiana tax on the same income. Indiana will not allow a deduction for gambling losses. This is because the Indiana tax is based on your federal adjusted gross income.
For Federal purposes you may deduct gambling losses on Schedule A as an itemized deduction. This may or may not be of help to you depending on your income level and the amount of other deductions you have.
For Federal purposes you may deduct gambling losses on Schedule A as an itemized deduction. This may or may not be of help to you depending on your income level and the amount of other deductions you have.
#8
Join Date: Apr 2003
Location: Silicon Valley, CA
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Unless i am misreading, the 4% Missouri tax is non-refundable. Filing a non-resident return won't help you. Indiana will give you a credit up to the Indiana tax on the same income. Indiana will not allow a deduction for gambling losses. This is because the Indiana tax is based on your federal adjusted gross income.
http://dor.mo.gov/tax/personal/indiv...008/m1040f.pdf
http://dor.mo.gov/tax/personal/indiv...2008/monri.pdf
Non-residents of Missouri are only taxed on Missouri source income (i.e., gamble winnings), and he is entitled to an income exemption of $2,100 if single, or $4,200 if married. On top of that, he is entitled to deduct standard deduction of $5,450 if single, or $10,900 if married. In other words, if his gamble winnings is less than $7,550 ($2,100+$5,450) if single, or $15,100 ($4,200+$10,900), then his taxable income in Missouri is $0, and, thus his tax to be reported on Line 31 of the tax return form should also be $0.
His 4% withholding tax can be reported on Line 32 (Missouri tax withheld). Since the tax withheld at 4% was more than $0 tax, the excess can be reported on Line 46 as overpayment subject to refund.
I hope you understand the concept.
#9
Join Date: Feb 2000
Location: Chicago, IL, USA
Programs: AA EXP, Hilton Diamond
Posts: 574
Missouri
Gambling losses do seem to be deductible in MO so I bow to tsuruke.
However, if the IN rate is 4% or more the credit for MO tax comes out in the same place as filing and getting a refund in MO. It is unlikely that IN would question the credit, but they could I suppose. In IN the gambling withholding on w2g's is non-refundable to non-residents.
However, if the IN rate is 4% or more the credit for MO tax comes out in the same place as filing and getting a refund in MO. It is unlikely that IN would question the credit, but they could I suppose. In IN the gambling withholding on w2g's is non-refundable to non-residents.
#10
Join Date: Apr 2003
Location: Silicon Valley, CA
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The point is not the deductibility of gambling losses against gambling winnings. The point is that, by filing non-resident tax return, you can "fix" the amount of tax liability in that state. You said, "In IN, the gambling withholding on w2g is non refundable to non residents," but, looking at Indiana's non-resident form IT-40PNR, non-resident's gambling winning is generally taxed on the following formula assuming he/she has no other income in Indiana:
(Gambling Winnings $xxxx less Exemption ($1,000 x # of family member)) x 3.4%
If he/she has a family of three, his gambling winnings in Indiana will be taxed against only a portion in excess of $3,000. If his gambling winning was $5,000, only $2,000 will be taxed at the rate of 3.4% ($68). If his gambling winning was less than $3,000, there will be no tax. And, the difference between tax withheld and the tax calculated on the tax return can be refunded by filing these pieces of paper with Indiana Department of Revenue.
Although this discussion is irrevant to skofarrell because he is a resident of Indiana, I thought it is good academic exercise.
(Gambling Winnings $xxxx less Exemption ($1,000 x # of family member)) x 3.4%
If he/she has a family of three, his gambling winnings in Indiana will be taxed against only a portion in excess of $3,000. If his gambling winning was $5,000, only $2,000 will be taxed at the rate of 3.4% ($68). If his gambling winning was less than $3,000, there will be no tax. And, the difference between tax withheld and the tax calculated on the tax return can be refunded by filing these pieces of paper with Indiana Department of Revenue.
Although this discussion is irrevant to skofarrell because he is a resident of Indiana, I thought it is good academic exercise.
#12
Join Date: Sep 2002
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I haven't done the gambling loss vs. win tax thing (since I haven't had enough winnings for it to matter yet).
...but I was reading a tax book for gambling which compared
a) Non-professional gambling: Losses on Schedule A (where you have to compare with standard deduction)
b) Professional gambling: Schedule C, where you pay Social security taxes, but you can subtract more expenses.
Can any more-experienced people here comment?
Thanks everyone!
...but I was reading a tax book for gambling which compared
a) Non-professional gambling: Losses on Schedule A (where you have to compare with standard deduction)
b) Professional gambling: Schedule C, where you pay Social security taxes, but you can subtract more expenses.
Can any more-experienced people here comment?
Thanks everyone!
#13
Join Date: Feb 2000
Location: Chicago, IL, USA
Programs: AA EXP, Hilton Diamond
Posts: 574
Suggest you look at BJ21.com
The website bj21.com will give you the info you need if you look at the archives and the Law & Taxes forum. Your question is a bit too big to answer here.