HomePublicationsNewsletter ArchiveNewslettersVolume 21Issue 8IRS Proposes New Tax Reporting Rules for Casinos

On March 3, 2015, the Internal Revenue Service (“IRS”) issued proposed regulations and an official notice regarding tax information reporting rules for slot winnings (as well as keno and bingo). Notably, the IRS is considering changes that aim to reduce the respective reporting thresholds from $1,200 to $600 on “electronically tracked slot play.” The reporting thresholds for winnings from those games, other than electronically tracked slot play, remain the same as under the existing regulations, but the IRS has noted that it will continue to monitor the existing reporting thresholds and may propose to reduce those thresholds at a future time. The agency set a 90-day public comment period set to expire on June 2, 2015, and a public hearing is scheduled for June 17, 2015.

Since 1977, the reporting threshold for winnings from a bingo game and slot machine play has remained $1,200, while the reporting threshold for winnings from a keno game remains at $1,500. Section 7.6041-1(c) of the Internal Revenue Code provides that bingo, keno, and slot machine winnings are reported on IRS Form W-2G, “Certain Gambling Winnings.” In connection with the current reporting requirements, a casino must provide a copy of the Form W-2G to the winning patron by January 31 of the year following the year in which the reportable payment is made, and the casino must file the Form W-2G with the IRS by February 28 of the year following the year in which the reportable payment is made.

“This potential policy change could create additional burdensome and unnecessary reporting requirements for our industry,” said Sara Rayme, senior vice president of public affairs for the AGA. “We stand ready to facilitate industry consensus and to advocate for rulemakings that benefit and protect the casino gaming industry’s interests. It is policy proposals such as this one that the AGA will address under our “Next Generation Gaming” platform that seeks to streamline regulations, remove barriers to innovation and allow regulators to be more nimble as the gaming landscape continues to evolve.”

To view the American Gaming Association’s summary regarding the proposed changes, click here.

The AGA Tax Working Group, comprised of senior tax representatives from AGA member companies, will submit comments to the IRS on behalf of the industry.

A full text of the IRS’s proposed changes can be found at:

https://www.federalregister.gov/articles/2015/03/04/2015-04437/information-returns-winnings-from-bingo-keno-and-slot-machines

 

Upcoming Events

Casino Job Board

Official Publications

 

RMC Legal

Visit our other website below: