Last Friday the federal government shut down several online poker sites and accused eleven (11) people involved in the website operations with committing fraud and running illegal online gaming operations. According to IRS attorneys, the Department of Justice not only seized accounts run by the various online gaming websites, but also grabbed money belonging to the online players.
The government’s action helps to illustrate the scope of the online gambling problem. For thousands of gamblers who consider poker a vocation, the online websites are a convenient way to make a living playing poker 24/7 from the comfort of their own homes. For millions of others, the online poker sites are a casual diversion for the less serious players. According to Poker Scout (which tracks data about online poker sites) last year approximately 1.8 million Americans played poker online for wagers totaling approximately $16 billion dollars.
So what if you are one of those unfortunate gamblers whose money was just grabbed up by the DOJ? First, consider consulting a tax lawyer or other tax professional to get accurate information about your rights and obligations under existing U.S. tax law. This is a complicated area of the law, in part because of the quasi-illegal nature of the activity (gambling) which is still evolving, so finding the right tax lawyer familiar with these gambling type issues may be tough.
One reason to hire a tax attorney rather than some other type of tax professional is that communications with non-attorneys (i.e. CPA’s, former IRS employees, and enrolled agents) are not privileged and the IRS may call your non-attorney representative as a witness against you. If you do hire a tax lawyer, don’t be afraid to ask direct questions about your case. If you receive evasive or intentionally complex answers from you tax attorney, he/she may be trying to disguise direct answers to your questions, so beware! Chances are this type of practitioner may not be the right tax lawyer for you.
If you have unfiled returns, owe back taxes, or are the subject of IRS wage garnishments, IRS levies and/or IRS liens, consulting with a competent tax attorney can save you. But, finding the right tax attorney to help you may be difficult. So, in the end, doing your homework and finding the right person to help you settle back taxes will save you a lot of grief, money, and even possibly help you avoid possible criminal penalties.
Segal, Cohen & Landis 9100 Wilshire Blvd. Ste. 601E Beverly Hills, CA 90212 (310) 285-3999