Nevada May Tax Online Poker Tournament Winnings

Posted on February 14th, 2013 by Renee Kingsley

Nevada May Tax Online Poker Tournament WinningsA new online poker bill may introduce a tax being charged as a percentage of the profits made from hosting online poker tournaments.

While brick and mortar casinos in Nevada all offer poker tables to their players, the game of poker has never generated large amounts of revenue in the greater scheme of things.

While Nevada may have received $123,253,000 from poker cash games last year, the amount taken in when compared to the amount that the casinos take in from overall gaming is rather small, since the cumulative amount reached is around $10.86 billion.

In Nevada, live poker tournament takings are not taxed. The tournaments in Nevada are exempt from state taxes since the tournament income is not, according to Nevada law, considered to be a part of the gross gaming revenue. While this law in Nevada is not likely to change any time soon, online poker tournaments may not be dealt with in the same way as land based tournaments.

At this time, the only legal online poker in Nevada is free play poker, however, should the law change, and online poker will become legal in Nevada, it is very much within the realm of possibility that the revenue from online poker tournaments will be considered to be taxable revenue. Online tournaments cost considerably less to run than land based poker tournaments.

A new bill that was introduced on Tuesday this week has provision in it that the state of Nevada would be able to collect a percentage of the profits that are generated from hosting online poker games. At the same time, another online gambling and poker bill that was introduced, allows for Nevada to enter into agreements with other states that also legalize online gambling. These state partnerships would increase the possible player pool size, which is especially important when it comes to playing in larger online poker tournaments.

In 2011, Nevada legalized online gambling. The state may soon see the start of some online poker sites that will use real money wagering, possibly as early as the first half of 2013.

While this tax would affect the poker operators, and possibly in turn affect the players, the new bill would have no effect on the individual player’s poker winnings.

At this time, Nevada taxes gaming at a level of 6.75%.

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