Don’t Let Your Big Prize Turn Into an Even Bigger Tax Debt

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Jackpot! If you’ve got a gambling spirit, chances are you’ve probably invested a good amount of time into casinos. But if you win big in Vegas, don’t let the thrill of victory cloud your head. If you’ve won money from gambling and you didn’t report your winnings to the IRS, you could be in for a disturbing wake up call.

Beating the House: Whenever you win money through gambling, you must report it to the IRS. The IRS wants to know everything about your finances. Not only do you have to report money won through a casino, but also raffles, lottery, and even bingo. The reason these winnings have to be reported is because the IRS considers them a form of income.

Snake Eyes! What happens if you owe the IRS money because you didn’t report the winnings, or if you can’t afford to pay them what you owe? Well, as an IRS Hitman I can tell you it’s not going to be pretty. Soon, you may even be regretting your winnings. It will be you against the IRS and unless you have a good arsenal, they’ll take you for everything you’ve got!

Stealing the Pot…The IRS has several ways of collecting on your tax debt and the most effective by far is the wage garnishment. This means the IRS can start taking money from your paycheck. And guess what? Neither you, nor your employer can do anything about it. The IRS can actually garnish up to 75% of your gross pay and that can put in a large financial hardship.

Play it Safe: If you’re already in this unfortunate situation, there are still ways of getting help. You can speak with a reliable tax professional who will give you the facts on how to resolve your tax debt once for all. The House may be a scary thing when it comes to the gambling industry, but the IRS’ House is even bigger. So remember, the next time you’re in Vegas, don’t go all in.

December 5, 2013: posted in Taxes And IRS No Comments

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