You Should (Mostly) Be Ashamed of Yourselves

So, here it is, tax day, and I bet you fudged your poker winnings. I bet you said to yourself: well, only online wins are actually traceable. Maybe you picked up a bunch of discarded betting slips at your local Off Track Betting establishment to “establish” some losses. Maybe you just figure that since that $8,000 you cashed out the last time you were in AC wasn't enough to generate a 1099-G, who will ever know as long as the cash is under your mattress.

Most poker players in the USA cheat on their taxes. It's a mostly a cash business, and records don't get generated unless the wins are really big. Since most pros win small amounts (less than the $10,000 or so that forces generation of a 1099-G), they don't report, or substantially under-report, their winnings.

Every year, I dedicate a post to scold you all. You are doing something wrong. I think it's a true societal injustice.

This isn't to say that I like what the taxes fund. I have my misgivings about income taxes; we all surely do. I looked at the graph in the back of my 1040 booklet this year with revulsion. In 2004, much more of my tax money was spent on national defense than on human development, and more than social programs; this disgusts me. Meanwhile, I think that it's scandalous that individual tax payers have to foot 35% of the federal budget while corporations get more welfare than any of us — they pay only 8% of the budget. You might guess, given my propensity for living in so-called “blue states” that I don't support the current administration (I didn't support the last one, either, for that matter). It's sufficient to say that I have never voted for the candidate who won; my government has never represented me.

But, I still believe it's wrong not to pay your taxes. You can use every argument in the book to say taxes are unjust, but it isn't civil disobedience to simply not pay. If you want to make a statement, enclose a letter with your 1040 saying: “I cheated on these taxes because the income tax system is wrong for the following reasons ...”. So I ask, of those of you that failed to report (or under-reported) your poker income, how many of you did that? If you didn't, then you aren't some sort of tax protester; you're just a thief trying to hide on “high moral ground” that isn't really there.

Keep in mind, all of you, how you made that money this year. You played a game. There are working people, who break their backs every day, or sit in soulless cubicles for 60 hours a week, and pay every last dime in their required taxes. Meanwhile, you made some money while you enjoyed your work. You played a game to earn that cash. I believe that gives you an even stronger obligation to pay up. (And, although it's off-topic, I'll note that if you didn't have fun while winning at poker in 2005, you may want to consider giving up the game and finding something else to do.) You have no right to ask those working people to carry more than their fair share while you get lucky because you're in a “cash business” and can evade the auditors indefinitely.

Ok, so there again is my annual rant about how poker players should be honest on taxes. For those of you that were honest, I commend you for doing the right thing. For those who weren't, may your guilt consume you and convince you to do the right thing next year. :)