I'm pretty sure I linked to all of those earlier in this thread already, pshabi. But thanks for double checking my work.
I also emailed PT support earlier today, asking them directly about adding a "Taxes" feature. Hopefully I'll hear something back from them.
As for the guy who says he's been moved into a higher tax bracket, I still have trouble believing that. In fact, I'm all but positive he's full of shit, or at least very confused anyw.ay. Isn't your tax rate based on your ADJUSTED (meaning after your deductions) Gross Income? I know you have said otherwise before, pshabi, but the losses really should come out fiurst, before the tax is calculated. Otherwise, I don't even know how you would deduct them.
In other words, like with the guy above:
128k total income = 28% tax rate (I think - I'm not looking it up). Add in the 6k net from poker and he's at 134k, which is still 28%. And that 28% is on the last of the dollars he earned, of course. That's something else people don't understand about taxes. He doesn't have to pay 28% on ALL the money he earned. The first however many thousand are taxed at 15% and so on and so forth. It's a sliding scale. Your "tax bracket" jusr refers to the last dollar you earned. IT's not the same as your effective "tax rate," which will always be lower.
If what he is saying was true, it would be:
$128k normal income + $123k poker winnings = $250k+ total income. This would be a higher tax rate. Let's pretend it's 33%, it doesn't matter. The point is, if we figure out the tax due HERE, how are we going to decuct his $120k in poker losses? It just doesn't make sense. In fact, I don't think it would even be possible.
I really think the losses will come out first and THEN we'll calculate what taxes are due based on your Adjusted Gross Income.
I just flipped thropugh a 1040 form and this is how it looks to me. Nothing else would make sense. And as ass backwards as the IRS is at times with their outdated laws and guidelines, typically when all is said and done things at least make sense. They may want you to SHOW every penny won and every penny lost, but you're only going to get taxed on the net win.
Ok.... When in doubt, read the instructions:
From what I am seeing, gambling winnings need to be reported on line 21. Gambling losses are then deducted on line 27, but only up to the amount of the winnings, of course. These, plus all your other itemized deductions are added up and deducted from your gross income, yielding your Adjusted Gross Income... and sure enough, THAT is the number that determines your tax due.
So it's all good.