Poker online is interesting to many because of the free game option.  Poker online does not only provide for free rolls, but it also provides for big cash wins for those that are interested in playing money games. Poker sites have reported to have dealt more than 4 or 5 million hands through their years of online gaming trade; and the dealing numbers increases exponentially day by day.  Interestingly the prize money is not any less, many sites have reported winnings of millions of money by players per week.

Both high stakes poker online and low stakes poker online are in popular practice.  The buy in can be as low as $1 and in the higher end it can be several thousands per site regulations.  Poker online seems to offer equal winning opportunities like the many world class tourneys.    The WPT and WSOP is not the only way in which poker players can make money, the same can be accomplished by playing in select poker online sites too!

That is the money part of poker online and we are aware that there can be big losing and massive winning too.  The tax man is not concerned if you are going to loose, but they are definitely concerned if you are going to make a good winning.  A good winning in cash games in poker online means a new income.  A new income is naturally related to the need for paying the related taxes to the government. Poker prize money is not tax exempted!

The IRS publication 529 advices players to keep a record of their winning and losing in their gambling bank roll.  The money that you win in poker online should be fully registered with the IRS and the money that you have lost in poker should be produced with enough proof so that it can be reduced from your taxable income.  You cannot make the subtraction of the losses and just report the resultant profit only.  The total winning and total loss should be reported separately and then it should be subtracted to arrive at the actual taxable income.

You must also retain the soft copies of your hand histories and e-mails detailing your winning and losses to provide as an additional proof, if the IRS is going to require a more stable proof.  Similarly you need to have copies of wagering tickets, credit records, bank withdrawals, and winning payout slips to avoid unnecessary confusions relating to your gambling income that is taxable.