Canadians And Their Casino Tax Refunds. How To Receive A Us Gambling Refund

Tuesday, April 13th, 2010 at 12:03 pm

Hit A Jackpot In The United States? A US Gambling Refund Is Available To Canadians

Canadians love visiting US casinos. Apart from enjoying lavish stage shows and concerts, and gorging on the loss-leader buffets, Canadians visit US casinos primarily to gamble. Yet when the Canadian gamblers hit US jackpots, these Canadian gamblers are also surprised with the dreaded US casino tax. The Internal Revenue Service (IRS) theoretically will refund gambling tax to Canadians and other non-resident gamblers, but actually receiving casino tax refunds is a complicated and often little known process.

The US casino tax is imposed on most casino jackpots over 00 US. The US casino tax on slot jackpots takes effect at 00 US. The tax on bingo jackpots starts at 00 US too. Strangely the tax on keno jackpots is set at 00 US. The US casino tax is set at a flat 30% of the jackpot. Thus a slot jackpot of 00 US would result in a US casino tax of 0 US.

The US casino tax is deducted at the source. The casinos will not refund gambling tax on site to Canadian gamblers. Gambling winners will leave the US casino with only 70% of the original jackpot amount, and will have to apply for a US gambling refund afterwards. Unfortunately most gamblers do not bother to pursue a US gambling refund, even though it is perfectly legal and is a substantial amount of money.

The Legal Basis For Casino Tax Refunds

Under United States tax laws, a gambler’s US casino tax burden can be reduced by the gambler’s corresponding US casino losses. In simpler terms, an individual’s US casino tax burden can be reduced by offsetting his/her US casino tax with his/her US gambling losses. Any type of US-based gambling loss can be used to offset the gambling wins. Thus losses from generally nontaxable table games like poker and blackjack, in addition to gambling losses from slot machines and bingo can reduce or completely negate the taxes from a slot machine win. If the gambling losses are smaller than the gambling win, the IRS will partially refund gambling tax for the applicant. If the gambling losses are as large or larger than the gambling wins, the IRS will completely refund gambling tax for the applicant. Since the vast majority of gamblers will have gambling losses that are at least as large as their gambling wins, most applicants for casino tax refunds will receive a US gambling refund for the complete amount of their withheld US casino tax.

Obtaining Casino Tax Refunds

As stated earlier, the IRS will theoretically refund gambling tax to qualified applicants. Unfortunately the reality is drastically different from the theory. Canadian gamblers attempting to obtain casino tax refunds will face a gauntlet of bureaucracy. The IRS was never known for its user-friendliness. It is even worse for non-Americans trying to obtain a US gambling refund. Canadian gamblers will often be given a bevy of contradictory information, often involving sending their ORIGINAL passports to the United States for several months in order to validate the applicant’s identity. There are horror stories surrounding incredible wait times, lost passports, and ultimately failed US gambling refund applications.

Luckily there are US government validated Certifying Acceptance Agents. Faced with numerous problems regarding foreign taxpayers and the IRS, the United States Government has licensed Certifying Acceptance Agents to act on behalf of Canadian gamblers and other non-residents in their dealings with the IRS. Certifying Acceptance Agents have met stringent standards of professional knowledge and responsibility, allowing for the fastest, most thorough casino tax refunds to the applicants.

Martin Downer is a retired Canadian high school math teacher who now splits his time between Victoria and Toronto. Martin Downer plays slots and poker. Tired of having the IRS deduct 30% US casino tax from his gambling wins, he decided to write about the US casino tax paid by Canadians. Casino tax refunds are available, but people are often confused with the various US tax laws.

Article from articlesbase.com