IRS proposes stricter reporting rules for casino winnings
Published 12:00 am Sunday, March 8, 2015
Uncle Sam’s cut on that next winning ticket from a slot machine at a casino in Vicksburg — or at gaming houses anywhere else in the U.S. — might be bigger if a proposed change becomes effective.
The proposal, released this past week by the Internal Revenue Service and first reported in the Las Vegas Review-Journal, would change the reporting rules for winnings from gambling. Slots, keno and bingo winnings requiring reporting would be reduced from $1,200 to $600. It means a winning slots player couldn’t win as much without being subject to federal taxes, which would add to the individual’s income tax liability. The agency set a 90-day period for the casino industry to respond to the suggested regulation changes.
Proposed rule changes by federal agencies hinge on public comments, making it no guarantee the IRS will revise the rules.
Under current law, a casino must file tax information forms if a player wins $1,200 or more on a slot machine jackpot or a bingo game, and winnings of $1,500 on a game of keno. Those minimums were set in 1977. Lowering the threshold would cause machines to lock up more often for customers to fill out paperwork. If put into place, the new rules would cover all casinos, including racetrack casinos and Native American tribal casinos.
Ameristar Casino referred comment to gaming industry watchers, who vehemently opposed the proposed tax law change for its potential effects on people and state treasuries. Emails to corporate parent firms of Riverwalk and Lady Luck casinos did not return emailed requests for comment.
“Not only would this potential policy change create additional burdensome and unnecessary reporting requirements for gaming companies, but it could also cost states millions of dollars in revenues that support vital public services,” Sara Rayme, senior vice president of public affairs of the American Gaming Association, said in an email Friday. “Rather than going backwards, the gaming industry seeks forward-looking policies that enable our industry to reinvest, innovate and create more jobs.”
The Washington, D.C.-based industry trade group will submit comments to the IRS on behalf of the industry. A working group composed of tax specialists from AGA’s member companies will compile the comments.
Comments are due June 1 and may be sent by mail to Internal Revenue Service, Attn: CC:PA:LPD:PR, (Notice 2015-21), Room 5203, P.O. Box 7602, Ben Franklin Station, Washington, D.C. 20044.
They may also be sent via email, to comments@irscounsel.treas.gov. IRS asked senders include “Notice 2015-21” in the subject line.