Ship It, Fish! - Not Playing, Home Game, and Taxes

About Not Playing, Home Game, and Taxes
Previous Entry Not Playing, Home Game, and Taxes Monday 16 April 2007 @ 09:26 Next Entry

I haven't played poker at all this month. Basically, I've quit. I have more to write about regarding my reasons, and I will. I've won about $20,000 already this year, and assuming that Cake Poker actually pays me (they are having huge delays in processing cashout checks; I've been waiting since mid-February), that will be a win comparable to my best years in the past. Why play anymore when I have better things to do?

That said, I'm still going to have my monthly home game, because the usual group are enjoyable people (not the annoying fish you have to put up with at casino and online tables). I've just sent an announcement for this Saturday.

I did my taxes. I read Ann-Margaret Johnston's book, How to Turn Your Poker Playing into a Business. I recommend this book if the whole Schedule A vs. Schedule C issue still confuses you or if you've never filed one or the other. For those who have studied this issue, it doesn't give any new information.

The only piece that it made clearer to me is why everyone is so touchy about this full-time vs. part-time idea. There is one single court case, once, about a professional gambler, that jhazen has previously quoted in my journal: if one's gambling activity is pursued full time, in good faith, and with regularity, to the production of income for a livelihood, and is not a mere hobby, it is a trade or business within the meaning of the statutes with which we are here concerned.

Added with Johnston's arguments that the IRS gets very suspicious of a Schedule C for any activity that seems fun, this probably accounts for the constant “not full-time” paranoia around the poker world. I believe that this is one court case, and therefore just one criteria among so many. Johnston herself argues that there are lots of criteria considered by the IRS. Frankly, when I'm playing more than, say, 3 hours of poker a week, I enjoy my day job more than I enjoy the poker, so if the IRS wants to see “toil” to believe it's not a hobby, I'll tell them under oath how boring the whole thing is.

Finally, I should note that I nearly had a losing year in poker in 2006. My net profit was a paltry $94.73, as my expenses were somewhat high ($2,105.73). Still, this is much less than I won in 2005. I had forgotten than in January 2006, I was still playing limit regularly at the $15/$30 level and had a bad 200 big-bet loss weekend. So, given that I had to dig out of that hole all year, I am fortunate that I had a win. It certainly didn't help that I spent most of the late summer and fall playing extremely low stakes, wasting time in tiny home games and very small stakes online, too. There's hours of my life I'll never get back.

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From:(Anonymous) on 17 April 2007 at 20:35
Subject: Cake no cakewalk
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You might want to cancel your pending Cake check cashout and switch to ePassporte. It's even worth opening a new account if you don't have one, in my opinion. After waiting weeks for Cake to process my check request, I started reading stories of months-long waits. One person even said that Cake support admitted they currently don't have a check processor at all, and recommended he go the electronic route.

Long story short, I submitted an ePassporte cashout request on Thursday 4/12 and it was completed this afternoon, a mere five days later. Despite the laughably soft competition, I'm glad to be done with Cake's horrible bug-ridden client and cashout woes.

Yancy
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From:shipitfish on 18 April 2007 at 16:17
Subject: Re: Cake no cakewalk
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Yeah, I'm working on epassporte, but since they do the two mini-deposit thing as a PIN, and since my lock-down restrictions on my account has phone banking, Internet banking, etc. turned off, I have to wait for a statement to arrive. Once it does, I should be able to set up and cashout.
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From:patty_bush on 19 April 2007 at 03:01
Subject: Small Stakes Cake?
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I'm playing small stakes LHE now. Do you think I'd see similar success? My FTP bonus expires next month and I want to move on.
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From:shipitfish on 19 April 2007 at 12:14
Subject: Re: Small Stakes Cake?
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I haven't played on Cake in a month and a half, so I don't know what the games look like there now.
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