More on IDs and Taxes

You said: "U.S. citizens will not have anything withheld from a slot win of $1200 or more if they can provide a valid Social Security Number. "

I am not going to argue. But it would behoove you to read what the IRS has to say.

http://www.irs.gov/instructions/iw2g/ar02.html

Also, reference the last 1-2 newsletters by Gail Mitchell. That was a topic of conversation. Between her readers and herself, they are almost close in their analysis. No one has that topic perfectly nailed down, re: ID's and winnings.

Your friend,
Arnie

Dear Arnie,

Well, I've never had any tax withheld from any of the jackpots I've won.

And I went to the page you referenced, Instructions for Forms W-2G and 5754 (2005). At the top, the instructions imply that winnings of over $5,000 would be subject to regular gambling withholding.

But here is what the page says specifically about withholding from slot winnings in section 3, Bingo, Keno and Slot Machines.

Regular gambling withholding (25%) does not apply to winnings from bingo, keno, or slot machines. However, if the recipient of reportable gambling winnings from bingo, keno, or slot machines does not provide a TIN, you must backup withhold at the rate of 28%. That is, if the winnings are at least $1,200 from bingo or slot machines or $1,500 from keno, 28% backup withholding applies to the amount of the winnings reduced, at the option of the payer, by the amount wagered.

Instead of just telling us we all have it wrong, why don't you give us a complete explanation of IDs and winnings?

Best of luck in and out of the casinos,
John

Hi, John,

My sister and I live in Michigan and visit Soaring Eagle Casino in Mt. Pleasant, Little River Casino in Manistee and Blue Chip Casino Boat in Michigan City, Indiana. We go to Soaring Eagle more often. It seems that Sis can win a bit once in a while, but I can't seem to hit anything good. I know you say the times and payoffs are random, but last time we went, Sis started to hit about 4 am until 9 am at the end of the month (we've heard so many people say this is the time to go). She just couldn't lose!! She ended up winning almost $700!! This has happened a couple times.

I found a few machines I liked that paid a little bit (Bucks Ahoy and Munsters - nickel slots), but just can't seem to find the right machine at the right time or end up ahead. Should I just find a new pastime? Should I try to devise a playing plan? Maybe I need to concentrate more on slowing down and paying attention to keeping my winnings separate from playing money...walk around and trust my gut. Do you think this might help?

I like to go gambling once in a while but am retired and must budget my funds.

Thanks so much for your insight!

Ellie

Dear Ellie,

If you're no longer having fun playing the slots, then you should find a new pastime. If you're still having a good time and you have enough in your entertainment budget to fund your losses, then there's no reason to change.

You can devise a plan if you like, but keep in mind that money management has no affect on the house edge. You can search on this site to find more articles on money management. I'll just briefly describe what money management means to me. To me, money management means taking steps to try to avoid running out of bankroll before you run out of desire to play.

Some good things about walking around are that you get some exercise and your money isn't at risk while you're searching for another machine to play. As for trusting your gut in choosing a machine, I suspect that method will be just as good as choosing a machine at random.

Best of luck in and out of the casinos,
John

Send your slot and video poker questions to John Robison, Slot Expert, at slotexpert@comcast.net. Because of the volume of mail I receive, I regret that I can't send a reply to every question. Also be advised that it may take several months for your question to appear in my column.

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