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Glossary

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AGI

The abbreviation for "Adjusted Gross Income." Adjusted Gross Income is calculated by determining a Gambler/Taxpayer's total income from all sources then subtracting certain other amounts such as educator expenses, alimony paid, IRA contributions, etc. This is the amount on the bottom of Page 1 of IRS Form 1040.

Cash Ticket

A printed coupon that is dispensed by an electronic gaming machine (e.g. video poker or slot machine) when the "CASH OUT" button is pressed. The coupon may be inserted into another electronic gaming machine or redeemed at the cashier's cage.

Cash-In

The amount of money that a person spends while gambling. This amount includes the initial amount invested, any subsequent amounts invested and any accumulated winnings that are reinvested. These amounts can be documented by ATM receipts, canceled checks, or credit/debit card charges. The IRS recommends that such amounts be recorded in a gambling diary or log book.

Cash-Out

When a slot machine player presses a button entitled “Cash Out”, a paper “voucher” is printed that may be inserted into another slot machine or presented to the Cashier for immediate payment. Since the “voucher” is kept by either the machine or the Cashier and no other receipt is provided, it is difficult to document such transactions. The IRS recommends that such amounts be recorded in a gambling diary or log book.

Cashier's Cage

The Gambler/Taxpayer may conduct any number of financial transactions at a cashier's cage including the redemption of a cash ticket, the exchange of a gaming establishment's chips for cash, issue or redeem a marker, or establish a line of credit.

Coin-In

Traditionally, the coins that were fed into a slot machine; synonymous with “Cash-In” above.

Coin-Out

Traditionally, the coins that were distributed by a slot machine when a player won or was finished playing; synonymous with "Cash-Out" above.

Comps

An abbreviation for "complimentary" goods and services that a gaming establishment provides to a Gambler/Taxpayer as an inducement for the Gambler/Taxpayer to patronize the gaming establishment.

Credits

Instead of immediately paying out any jackpots below the hand paid jackpot threshold, many electronic gaming machines allow "credits" to be accumulated. These accumulated credits may be played by a Gambler/Taxpayer or converted to a cash ticket by pressing the "CASH OUT" button.

CTR and CTRC

Common abbreviations for “Cash Transaction Report” and “Cash Transaction Report by a Casino”; a CTR or CTRC must be prepared and forwarded to the appropriate government agency whenever a cash transaction or series of cash transactions involve $10,000.00 or more during a single 24-hour period. Such filing requirements were instituted to discourage money laundering.

Form 1040 U.S. Individual Income Tax Return

An IRS form used to report an individual's taxable income and resulting income tax liability. IRS Form 1040 for a specific calendar year is due on April 15th of the following year, but an extension may be granted to October 15th for qualified taxpayers.

Form 1099-MISC Miscellaneous Income

A form commonly used by casinos to report the value of prizes, awards or complimentary goods and services ("comps") received by a Gambler/Taxpayer. One copy is provided to the IRS and a duplicate copy is provided to the Gambler/Taxpayer.

Form 5754 Statement by Person(s) Receiving Gambling Winnings

An IRS form provided by a Gambler/Taxpayer to a gaming establishment to indicate the individuals that will share gambling winnings and subsequently receive their own individual W-2G's. This form is commonly used by winners of a lottery pool.

Form W-2G Certain Gambling Winnings

The IRS form used by a gaming establishment to report winnings above certain amounts to the IRS. A duplicate copy is also provided to the Gambler/Taxpayer. As an example, a gaming establishment will issue a W-2G to Gambler/Taxpayer when he or she wins a slot machine jackpot of $1,200 or more - in this case, a hand paid jackpot.

Form W-9 Request for Taxpayer Identification Number and Certification

An IRS form used by a gaming establishment to request the Gambler/Taxpayer's tax identification number (typically a person's Social Security Number). The gaming establishment is then able to properly forward to the IRS a copy of a Gambler/Taxpayer's Form W-2G's or Form 1099-MISC's.

Gambling Diary

IRS Revenue Procedure 77-29 recommends that a Gambler/Taxpayer maintain an accurate diary of wagering wins and losses.  It also specifies the type of information that should be recorded and the type of documentation needed to verify the transactions.  The Lady Luck Gambling Diary is the only gambling diary available that complies with IRS Revenue Procedure 77-29. Also know as a Gambling Log.

Gambling Session

A discrete, isolated time period where the Gambler/Taxpayer is performing a specific action or activity. If that activity is interrupted, then a new and different “Gambling Session” begins when the activity begins again.

Hand Paid Jackpots

A jackpot that is paid to the Gambler/Taxpayer by an employee of the gaming establishment instead of by the machine. For slot machines, a Gambler/Taxpayer will receive a hand paid jackpot for amounts won of $1,200 or more.

Internal Revenue Service (IRS)

The US government agency responsible for tax collection and tax law enforcement. Please visit their web site at http://www.irs.gov for more information.

Marker

Traditionally, gambling debts are not legally enforceable. Therefore, a Gambler/Taxpayer will issue a "marker" instead of taking out a legally enforceable loan. Frequently, a marker will be secured by a post-dated check. Often times, a Gambler/Taxpayer hopes to redeem his or her marker using the proceeds from any future winnings.

Percentage

The mathematical advantage that the "house" (the gaming establishment) has over the patron (Gambler/Taxpayer).

Player's Card

A card (similar in size to a credit card) issued by a gaming establishment. When inserted into an electronic gaming machine, a gaming establishment is able to monitor a player's transactions. Many gaming establishments award "points", similar to a frequent flyer program, based upon the frequency and amount wagered. As a result, the Gambler/Taxpayer may redeem the points for prizes, discounts or other complimentary goods and services. Many Gambler/Taxpayers are under the mistaken belief that an activity report from a Player's Card will meet the requirements of IRS Revenue Procedure 77-29. However, the IRS frequently refuses to rely upon Player's Cards since a Gambler/Taxpayer may not use it every time they gamble, it is possible for someone else to use the Gambler/Taxpayer's Player's Cards, and such activity reports frequently contain disclaimers that any amounts provided are merely estimates and should not be relied upon for accounting purposes.

Progressive Jackpots

Groups of electronic gaming machines that are networked together. A fraction of each wager from each electronic gaming machine is contributed to the jackpot so that it progressively grows larger until it is won. Some progressive jackpots have electronic gaming machines that are networked together over a wide geographic area such as a city or a state.

RNG

The abbreviation for "random number generator." The internal computer program of an electronic gaming machine (e.g. video poker or slot machine) that mathematically determines the outcome.

SAR or SARC

The abbreviation for Form FinCEN 102 Suspicious Activity Report - Casinos and Card Clubs. While assisting a Gambler/Taxpayer with cash transactions of any amount (but especially amounts of $10,000 or more) an employee of a gaming establishment is required to report any "suspicious activity" by the Gambler/Taxpayer that may indicate an intent to circumvent the reporting requirements or be involved in money-laundering. It is commonly believed that the accumulation of SAR's by a Gambler/Taxpayer will trigger an audit by the IRS.

Schedule A Itemized Deductions

An IRS form used by a "casual" or "recreational" Gambler/Taxpayer to report "gambling losses to the extent of winnings" as an other itemized deduction (not subject to the 2% limitation). The completed form is attached to a Gambler/Taxpayer's IRS Form 1040.

Schedule C Profit or Loss from Business (Sole Proprietorship)

An IRS form used by a professional gambler to report gambling winnings and gambling losses. (The gambling losses are limited to the amount of a Gambler/Taxpayer's gambling losses.) The completed form is attached to a Gambler/Taxpayer 's IRS Form 1040.

Whale

A person that regularly wagers large amounts of money. So desirable are these "high rollers" that the casinos go to great lengths to lure them to gamble at their establishments. In addition to the usual "comps", such "whales" often receive special VIP treatment - including free airplane and limousine service, and use of the best suites. In addition, the "whales" may be invited to gamble in exclusive areas of the casino.

Win/Loss Statement

A common report provided by a casino or gaming establishment to their patrons. The report provides an estimate of a patron's wins and/or losses. A typical win/loss statement contains language indicating that the report is only an estimate, has limited accounting significance and is for informational purposes only. As a result, the IRS discourages Gambler/Taxpayers from relying upon such reports in the preparation of their individual income tax returns. An industry standard format for the report does not exist. Different gaming establishments may provide varying amounts of detail.

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