INDUSTRY FORUM

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  • SmartWater

    Marketing and Social Media Manager

    Hello Grinders!

    One of the most important days of the DFS year is nearly upon us: the Super Bowl? Nope – the tax deadline!

    We’ve once again teamed up with the best in the business to help make sure you have everything in order for the current tax year.

    DFS Accounting Services, LLC has over 30 years of collective accounting experience and are a registered and licensed CPA firm with the AICPA and IL CPA Society. In short, they can provide unparalleled tax and consulting services for casual players and seasoned DFS Pros alike. They offer free tax consultation for your DFS activities over at dfsaccounting.com

    This is our 3rd year working with DFS Accounting and many of our own staff use them for their annual tax services. If you have any questions, this is your chance to ask away in this year’s Q&A thread!

    DFSAS Disclaimer: DFS Accounting, LLC are Certified Public Accountants licensed by the AICPA and State of Illinois. Any information provided is for informational purposes only and is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant, CPA, lawyer or other competent financial professional. Information posted by DFS Accounting, LLC on RotoGrinders or any other media forum does not constitute an accountant-client relationship. At your request, DFS Accounting, LLC can send an engagement letter, which outlines their responsibilities provided under their engagements.

  • drewcrawford03

    • 2019 FanDuel FantaSea Finalist

    • 984

      RG Overall Ranking

    • 2018 FanDuel WFFC Finalist

    @craftylefty said...

    So the CVS/Excel/History that you can download from Draftkings does not match up with the CVS/Excel that Draftkings is using to calculate your 1099. When you request that document, Draftkings only provides the totals and not the document so you have no way verifying the information is correct.

    I simply can not remember 1099s being calculated this way in the past. I don’t remember any one questioning 1099s in this manner until this year. I can’t remember any one chatting in any discords or slack chats that I am involved with discussing this at all.

    I could be wrong but it feels like the goal posts were moved without telling anyone in regard to how 1099s are calculated.

    I just feel blindsided because I was tracking my winnings through out the year and now I have a tax obligation that is significantly more than I was anticipating.

    Try asking FD 3 different times throughout the year and them telling you the Bonuses do NOT count as added “income”, only to be told by their tax specialist (after challenging the 1099) that it does.

  • ttucowboy84

    • 602

      RG Overall Ranking

    Question — I won on FD but lost on DK. Do I pay taxes on the net between the two or am I required to pay taxes on 100% of my FD net and eat my DK losses?

    Update – Please disregard. I see this topic has already been thoroughly discussed.

  • DFSAccounting

    An update to the 1099 calculation questions:

    We’ve been in contact with DK. We are in the process of walking through examples so that we can provide more clear guidance.

    We will provide an update ASAP.

  • dengel2430

    • Ranked #90

      RG Tiered Ranking

    Sorry if this was asked before but I can’t find the answer…..So I got a 1099 from DK do I report it as gambling winnings or in the 1099 misc section when doing it through turbo tax?

  • DFSAccounting

    @dengel2430 said...

    Sorry if this was asked before but I can’t find the answer…..So I got a 1099 from DK do I report it as gambling winnings or in the 1099 misc section when doing it through turbo tax?

    We’d recommend 1099-MISC section. Not sure if Turbo tax has a designation for hobby income.

  • dengel2430

    • Ranked #90

      RG Tiered Ranking

    Ok Thanks!

  • tjgje

    @DFSAccounting said...

    Rev. Rul. 57-521, where the IRS ruled that if winnings are predetermined and must be awarded regardless of how many participants and/or how much is collected in fees, then it is not considering a wagering pool. Thus the taxpayer is awarded a prize from the contest based on their mental skill and not luck.

    I believe last sentence implies DFS is gambling.

    “the taxpayer is awarded a prize from the contest based on their mental skill and not luck.”

    The value of the prize varies with luck. I would also argue the same mental skill that is employed by DFS players is the same as the mental skill that is employed by gamblers. In DFS the salaries adjust according to the probability of uncertain player outcomes. In gambling, odds adjust according to the probably of uncertain player or team outcomes. In both cases, the mental skill involves trying to identify mispriced players for DFS and mispriced odds for gambling prior to making a wager on an uncertain outcome. Uncertain outcomes involve luck.

  • eruthruff

    Draftkings seems to be telling me that contest entries are assigned to the year in which you entered the contest, but contest winnings are assigned to the year the contest starts (or maybe when it finishes). Does that make sense? I suppose does fit the usual formula you see on the internet: Total Withdrawals + End Acct Balance – Total Deposits – Beginning Acct Balance (contests entered but not finished decrement your balance but cannot possibly increase any other terms in the equation). How did I not know this?

    It means that, for tax purposes, you could erase an actual profit simply by entering a sufficient number of high value contests on Dec 31st. Example: For those who want to avoid getting a 1099 while being ahead $900 for the hear, you just enter $301 in contests on Dec 31st.

    Of course, this would just increase your profit for the next year, but then you could just do the same the next year.

  • DFSAccounting

    Hello Grinders,

    We hope everyone is doing well and is safe during these crazy times. While our discussions are primarily focused on arguing about the taxation of dfs income and/or how DF and FD fail to report your income correctly, we here at DFS accounting understand that many grinders have been affected by the coronavirus. We want to extend our knowledge and provide a free consultation on anything related to taxes or finances. Our conversion can be about anything. We will try our best to answer your questions and provide guidance where we can. We just want to help! email us at info@dfsaccounting.com

    We are actively monitoring the tax law changes and as I write the post, the stimulus package is being signed into law. We will do our research and report back how this affects you.

    Tax deadline AND tax deadline to pay your taxes was extended 3 months to Monday, July 15th. – 90% of grinders will be ready to file by the original due date of April 15th. We suggest you prepare your tax return asap. This is because many of you will be getting refunds and these funds will be crucial NOW. If you anticipate you will owe, then it is best to find out how much you owe NOW. You can file your tax return and make your payment by July 15th.

    Good luck to all of you and be safe!

  • DFSAccounting

    Hello all,

    We hope you are safe. At the time of this writing, the Covid stim package was just accepted by the house and will now go to the president to be signed into law. There are many aspects of this package but we will focus on two, expanded unemployment benefits and stimulus checks.

    UNEMPLOYMENT BENEFITS: – for those who had to take unemployment, those benefits increased by $600 per week for up to four months. If you received unemployment benefits you will receive a 1099-G this time next year. BE ADVISED, unemployment benefits is TAXABLE at the federal (IRS) level. In addition, several states tax unemployment. Keep this in mind when applying for unemployment, the application will ask you to withhold taxes. Some applicant will elect out of withholding taxes due to their financial situation, be careful, because this may cause a balance due when you file your 2020 tax return.

    STIMULUS PAYMENT – Single filers and Head of household will get $1,200. Married Filing Joint filers will get $2,400 – Qualifying children age 16 or under will get a $500 each. – example. you file jointly and have 2 kids under 16. you will get $3,400 ($2,400 + $500+$500) – The stimulus payment is based specific income requirements. Once you hit the initial income limit, the stim payment begins to phase out and will phase out completely when it hits the second income limit. Income limits are as follows:
    Adjusted Gross Income or AGI – can be found on your tax return, page 1 line 7 on your 2018 tax return and page 1 line 8b on 2019

    SINGLE – $75,000 AGI – Any amount $75,000 or below will get full refund. Above $75,000 stim payment will begin to phase out.
    SINGLE – $99,000 AGI – Complete phase out. No stim payment above $99k

    MARRIED FILING JOINT (MFJ) – $150,000 AGI – Any amount $150,000 or below will get full refund. Above $150,000 stim payment will begin to phase out.
    MARRIED FILING JOINT (MFJ) NO KIDS – $198,000 – Complete phase out. No stim payment above $198k
    MARRIED FILING JOINT (MFJ) AT LEAST 2 KIDS – $218,000 – Complete phase out. No stim payment above $218k

    HEAD OF HOUSEHOLD – $112,500 AGI -Any amount $112,500 or below will get full refund. Above $112,500 stim payment will begin to phase out.
    HEAD OF HOULSEHOLD – $136,500 AGI – Complete phase out. No stim payment above $136.5k

    Payment will be based on what tax return is on file with the IRS. You must have at least your 2018 tax return filed. Payment will be made electronically if you elected to get direct deposit or direct withdrawal. If you did not, the check will be mailed to the address on file with the IRS. Make sure the bank account you put on your tax return is open or the payment will bounce. Treasury Sec Steven Mnuchin said the checks will be sent within three weeks.

    TAX PLANNING – Pay close attention to your 2018 and 2019 Adjusted gross income. You may be over the income limits in 2018, but under in 2019. If that is the case and you haven’t filed your taxes, file them ASAP. Vice Versa. If 2018 was a bad year for you and your under the income limits and 2019 put you over, hold off filing your tax return until the stim payments have been paid. You have until July 15th so there is plenty of time.

    Things are changing by the hour and we ask any practitioners in the forum to provide any helpful information. If you have specific questions about your tax situation, do not hesitate to contact us. We are here to help and offer free consultation. Email: info@dfsaccounting.com.

    Be safe!

  • danwelch302

    Just seeing this now. You can definitely deduct gambling losses on Schedule A. It is subject to a 2% floor. I’m a CPA and I’m not sure why they are saying anything else. They said the same thing on their podcast.

  • tecmo27

    • 17

      RG Overall Ranking

    • Ranked #15

      RG Tiered Ranking

    I am filing my 2019 taxes with DFS as a business since I qualify based on the “9 relevant factors”. I have a profit from FD and a loss from DK. My loss from DK is more than my profit from FD. I’m using TurboTax. On Schedule C, do I put my exact loss from DK or do I reduce my loss so that it matches my profit from FD?

    Also, a related question: if I have two full time jobs with one of them being DFS, then can I deduct losses from DFS from my other job?

  • Hello, first time big gpp winner on fd back in January, i was wondering what happens, does fd send me a tax form on my total winnings for this year, i play nba and nfl at low volume high reward if i win, which obvisouly odds are low. I set aside 40% of my winnings off the rip, i guess what am i looking at for a bill.

    My normal job i make around 30 k a year, granted i only work 7 months of the 12… does everything remain the same, and then next year i will be paying my dfs bill to the tax man, because they already take taxes out each week with my regular job.

  • scooter186

    Hi, is there any given threshold or IRS requirement(s) you need to meet to classify yourself as a business vs. a hobbyist?

    Also, for your clients who do file as a business, do they incorporate (and is it required to do so)?

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