Tax relief would benefit exotic bettors
The National Thoroughbred Racing Association is asking for a tax break for horseplayers.
According to the Daily Racing Form, lobbyists from the organization are asking the U.S. Department of the Treasury to issue a ruling on whether bettors can use the total cost of a wager to determine tax liability.
Presently, the tax rule uses the denomination of a wager to determine tax liability. The NTRA is seeking an opinion that would allow players to use the total cost of the wager instead. The change could mean substantial tax relief to many exotic-wager bettors and players who focus on multi-race bets, the DRF reported.
“Under an archaic IRS ruling currently in place, players’ winnings are being erroneously reported or withheld without regard for how much they actually wagered,” NTRA president Alex Waldrop said in a release. “If granted, this clarification will allow horseplayers to keep more of their winnings, reduce the administrative burden on tracks and account-wagering companies, and ultimately generate more revenue for tracks, horsemen and government.”
Tax policy on gambling winnings works against those who place exotic wagers and multi-race bets like the Pick 4 and Pick 5, which can often have payouts that exceed the 300-1 federal tax limit even though the payoff is only four or five times the cost of the player’s total bet.
The letter sent by the NTRA to the U.S. Treasury Department was co-authored by Louisiana Rep. Charles Boustany and Kentucky Rep. John Yarmuth. Both are members of the House Ways and Means Committee, which has oversight over IRS rules.
