Modernizing Pari-Mutuel Tax Withholding
Will Be Good for Horseplayers and
the Entire Racing Industry
Changes Will Ensure Both Withholding and Reporting
of Winnings Accurately and Fairly Reflect
the Realities of Wagering Today
|Mike Campbell, ITHA President |
Dear Fellow Horsemen:
In response to efforts spearheaded by the NTRA, the United States Department of the Treasury and Internal Revenue Service are considering changes to reporting and withholding requirements related to pari-mutuel winnings.
The changes would positively impact all levels of horseplayers, regardless of whether a person wagers $1, $100 or $1,000. For example, the amount wagered by a Pick Six player who hits with one of 140 combinations on a $1-minimum wager would be $140, which is the total amount bet into the Pick Six pool. Currently the "amount wagered" is calculated using only the $1 bet on the single winning combination. By understating the amount wagered in this manner, the IRS is imposing significant additional reporting and withholding obligations on horseplayers while creating unnecessary paperwork for the IRS.
A clarification would directly benefit pari-mutuel customers by reducing burdensome tax obligations. The proposal also aims to lessen racing's competitive disadvantage against other forms of gaming that are not subject to such aggressive tax treatment related to reporting and withholding. According to Daily Racing Form, redefining the way the IRS calculates the amount wagered to include all money bet by an individual into a single pool would eliminate a high percentage of the reporting and withholding tickets and could increase pari-mutuel wagering by as much as 10% in year one alone.
An easy-to-use, pre-populated message submission page (that can be edited) has been established at www.NTRA.com/IRScomment for individuals to submit a comment directly to Treasury.
The deadline to submit a comment is Tuesday, June 2. Please act now by clicking here.
Thank you in advance for supporting this important initiative.
As always, I'm proud to serve the finest horsemen I know.
Illinois Thoroughbred Horsemen's Association