If you are non-U.S. citizen or resident and have played at the World Series of Poker (or any other U.S.-based poker tournament), you are familiar with the taxation process that occurs after you win. However, if this is your first U.S.-based tournament series, there are a few things you should familiarize yourself with before making the journey this summer:
Will I have any of my winnings withheld?
If you win more than $5,000 (after buy-in) and are not a U.S. citizen or resident, you might have 30% of your winnings withheld at the payout window. However, certain countries have tax treaties with the U.S., which exclude gambling winnings from taxation. If you are a resident of one of the following countries and have an ITIN, you should not have any money withheld:
What is an ITIN?
ITIN stands for Individual Taxpayer Identification Number. This number allows non-U.S. citizens or residents to file U.S. tax returns. Once you receive an ITIN, you can use it at the payout window to ensure no money is withheld (if you are a resident of a qualifying country)
How do I receive an ITIN?
You must apply for one with the U.S. government, which can be done by using a Certified Acceptance Agent in the U.S.
What documentation do I need to apply for an ITIN?
You must have a certified copy of your passport. It must be certified by the issuing country and cannot be notarized
What if I am not a resident of one of the countries listed above?
The casino should withhold 30% of your gross winnings and give you Form 1042-S, which shows the amount of money you won and the amount of tax that was withheld. This form is important to the tax return process, so you should make sure to keep this form until the tax return is submitted
Is it possible to receive a refund?
If you meet the requirements, you can file a U.S. tax return to determine if you are due a refund
When can I file a U.S. tax return?
Tax returns can be filed in March of the following year. So if you had money withheld in 2017, you would be able to submit a tax return in March 2018
What information do I need to file a tax return?
In order to file a return, you must have the tax form you received from the casino (Form 1042-S) and a summary of your total gambling winnings and gambling losses
How long does the refund process take?
If you are applying for an ITIN and a refund, the entire process takes 6-8 months. However, if you have already been issued an ITIN, the refund process will take 3-4 months
How will I receive my refund?
The U.S. government will send a check to the address submitted on the return that can be cashed worldwide. If you have a U.S. bank account, the money can also be deposited in that account
If I had money withheld in the past, can I receive a refund?
You are able to go back three years (from the due date of the tax return) to receive a refund. So as of this Q&A, you would be able to go back to 2013 to receive a refund for money withheld
Kondler & Associates, CPAs is a full-service accounting and financial consulting firm with locations in Las Vegas, NV and Atlantic City, NJ. The firm, led by President and Owner Ray Kondler, CPA, specializes in individual and corporate tax preparation and has developed an expertise within the gaming industry over the past 10 years. As a Certified Acceptance Agent, Kondler & Associates has helped hundreds of non-U.S. citizens receive ITINs and tax refunds for excess money withheld.
If you would like to receive more information about our services or schedule a free consultation please contact us at (702) 433-7075 or visit our website www.PokerCPA.com
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