March betting and tax madness
Thursday, March 15, 2012
I am not a basketball fan. And aside from the occasional lottery ticket purchase, I'm not a big bettor.
So I am in the definite minority for the next few weeks.
Most of the United States, including Obama and a visiting U.K. dignitary, are following college hoops playoff games.
And many of these National Collegiate Athletic Association men's basketball fanatics are also betting on the games.
Sure, a lot of the money is put into office pools and other casual betting options. But a big chunk of change also is put down at legal betting parlors.
Vegas, baby! The Las Vegas Sun reports that March Madness in Sin City means that sports books will print more tickets this coming weekend than any other time this year.
Photo of Las Vegas sports betting courtesy Outta Towner
The Nevada Gaming Commission does not keep specific records on March Madness bets, but some in the industry say the three-week tournament could bring more money into the Silver State than the Super Bowl, which is the biggest single-day betting event in the world.
The 2012 Super Bowl brought in nearly $91 million statewide in handle (that's the total amount of money wagered), beating last year's record of $81.2 million. Estimates are that betting on college hoops each spring brings $3 billion in handle worldwide, with Las Vegas' share as much as $90 million.
Internet bets: Then there are the online outlets. Despite America's love of the convergence of technology and gambling, Internet betting is still illegal.
It's also hard to police, but that's not stopping some money managers from trying.
EBay owned PayPal is restricting accounts of people it suspects use the payment service to place bets on the NCAA basketball championship tournament. Some users, reports Bloomberg News, have received emails warning:
"After a recent review of your account activity, it has been determined that you are in violation of PayPal's Acceptable Use Policy regarding your sales / offers of March Madness sports pool."
The email then asks the recipient to sign an online "Acceptable Use Policy affidavit" to regain full use of the account.
Show of hands, please, from all y'all who join me in thinking that this PayPal CYA correspondence won't stop online gamblers intent on putting money down on this big event or in the future.
Winnings are taxable: Of course, we now break for my regular announcement, issued each NCAA tourney time and as the Super Bowl approaches, about gambling proceeds. They are taxable income.
Most gamblers won't have to worry about the Internal Revenue Service. Bettors lose about $100 billion a year.
But if you beat the odds and hit a jackpot, including any payoff for correctly picking this year's NCAA men's basketball champion, congratulations!
And remember to report it on your tax return.
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