IRS Will Not Tax Forfeited Jackpots Of Compulsive Gamblers
Well, in the interest of fighting gambling addiction, I offer this. The ruling was only on the program in one state and I don’t know which one. The program seems to be similar from state to state, but it is not identical. Subtle differences might make for different income tax answers. For example, the Indiana program indicates the forfeiture is in the “form of a fine”. In the Illinois program, the participant gets to decide which of the addiction services organizations the money goes to. So it might still be possible that in your state there would be a difference that would make you taxable on the forfeited jackpot. So stay out of those casinos.
Bank Out 40 Grand When It Allows Withdrawal Two Hours After IRS Levy
Back before Congress put significant restraints on IRS collection activities in the mid-nineties, I remember a period when they tried automating the collection process. It could be extremely painful as money was grabbed from people who did not really owe it. As I read collection due process cases, it strikes me that we may have gone a bit too far in the other direction as taxpayers seem to be able to stretch the process interminably. I don’t see a lot of jeopardy assessments, but it appears that banks are going to be under pressure now to act on them very quickly. You have to wonder how this case would have turned out if Mr. Hanson had beaten Mr. Waterman to the bank by two minutes instead of two hours. Clearly, though Chase had to respond much more quickly than two days.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.