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Casinos to report poker winnings to IRS

Following negotiations, casinos are to report all poker winnings to the IRS, it has been reported.

Casinos will be required to fill in a W-2G form which details the amounts of money being won and by whom. They will then send it to the tax agency.

The news is likely to be welcomed by many poker players who "require a large cash bankroll to ply their trade".

It had been thought that casinos may have to withhold winnings after the IRS issued them with a notice last month saying that they should keep 25 percent of all tournament winnings above $5,000.

However, casino bosses and the IRS reached a compromise and poker players remain responsible for paying taxes on their winnings at the end of the fiscal year.

No new laws have been passed regarding a tax on gambling, but the IRS was choosing to re-interpret legislation made by congress back in 1976.

The new system of reporting winnings will not affect those playing poker online.