Tax Increase on Poker Tournament Winnings Dropped

There was a panic for a short while. Professional poker players all across the U.S. were dazed, angry, and even confused when the United States IRS decided they were going to raise the withholding tax from poker tournament winnings to 25%. While this increase was only going after winnings of over $5,000, this is still a lot of money being taken.

But, usa poker players from coast to coast can sleep easier now that the United States has abandoned this tax increase. And, a little "thank you" may be owed to the Association's Tax and Finance Task Force who lobbied against the proposal.

So now, instead of the withholdings being 25%, U.S. winners will just be issued an earnings/tax statement, which will declare their winnings. Although it is still unclear which form will be used, there is rumor that the IRS's W-2G Form might be used as it is already in place to report miscellaneous income.

Wally Chalmers, Vice President of the American Gaming Association state that the casino groups that they represent are "very pleased that it has worked out the way it has." And once the new rule details have been ironed out, the new IRS Revenue Procedure will be issued.