PLEASE HELP! online poker income- can i make IRA contirubtion?

my only income for the year was about 12000 in online poker income. i want to make a 5000 IRA contribution to eliminate tax liability. Is this "earned" income and can i do this? wasnt there a legal case which ruled it as eaerned.
PLEASE HELP! online poker income- can i make IRA contirubtion?
If you were a professional and you could report the income on Schedule C, you would be entitled to fund an IRA. However, you would also be required to pay about $1,800 of self-employment taxes which is probably more than you owe now. So you wouldn't save taxes.
Reply:Asked and answered. Unless you're a professional gambler it is NOT earned income. And on-line gambling is ILLEGAL in the US so an IRA contribution is the least of your concerns.
Reply:It's not illegal to bet online with an off-shore poker room! There is NO federal law that makes the act of wagering online illegal. The only federal law that addresses gambling is the wire act from the 1960's which makes it illegal to place wagers via the telephone. The US government passed a port security law and tacked on provisions (UIGEA) that make it illegal for BANKS, not players, to fund or accept payment from gaming sources. The only problem (for the govt) is that there are dozens of third party methods available for funding and no way to trace ACH credits. In other words, the new provisions are only for show and the end result is a waste of ink. I still use my VISA check card and e-check on my favorite sites. Online gaming will be impossible to completely eliminate from the US. The best they can do is make it inconvenient. Eventually I see the industry being regulated and taxed...heavily!





The only states with laws directed towards online wagering are Michigan, Illinois, Louisiana, Oregon, Wisconsin, Washington, Indiana, Nevada, New York, New Jersey and South Dakota. Although these states do have specific laws pertaining to online gaming, there has not been any charges laid.





Some sites have decided, on their own, to no longer accept American players. These are the publicly traded companies and most have returned to private owners. There are still many highly reputable sites that welcome and cater to American clients.


I have wagered online for years and make good money betting on sports and playing poker. You can get free poker tips, tools, and reviews of only highly reputable poker sites at http://GamblingReviewsSite.com/


The recommended sites all offer top customer service, security, and fast/free payouts.








As far as you tax question,i suggest contacting the site you play on for advice or going to a local tax office.
Reply:Not earned income...it's gambling winnings.