Poker Bankroll Management
My poker winnings are up to $725US and I'm getting apprehensive about leaving money at the various sites due to ambiguity of the legality of online poker. In all likelihood I'm being paranoid, but I'd hate to see my hard earned winnings disappear with a couple court rulings or if one of the sites goes bankrupt. Also, since I've only been playing $0.25 no-limit tables, I really only need to maintain $200 at any given site to weather a bad streak.
I already use a Neteller account so that I can easily transfer funds back and forth to the different sites for bonus whoring. But, Neteller funds are not insured by CDIC and as my bankroll keeps growing, I'm looking for an alternative to protect my winnings. Although I can transfer funds from Neteller to my bank account, I am hit with foreign exchange fees which can be costly. I will need a US chequing account so that I can do electronic transfers as needed.
So far, I have found that TD has a US daily interest chequing account. While deposits into the account are free, withdrawals are $1 per debit unless $1,000 is maintained in the account. It also pays a dismal 0.05% interest on balances less than $5,000. What I found interesting, was that this account is not insured by CDIC either. I would think(hope!) that TD is reputable enough to not have to worry about being insured. I was hoping I'd be able to use my brokerage account, but Neteller apparently can't send ETFs to these types of accounts. I'd like to be able to find something that pays a little higher interest, so the search is on. Any suggestions?
I've also signed up for rake back at Rake Break. This will give me 30% of the rake that I pay back to my poker accounts. I've decided that at my limits, chasing bonuses is quite time consuming and this will be a better option for me. I'm estimating that this will generate $15/month. Admittedly, it's a small amount but it's nice to have a hobby that puts money into my wallet rather than empties it.
posted by Frugal Canadian @ 2/21/2006 09:56:00 PM
8 Comments:
question: do you get taxed on your winnigs?
petey pablo
In Canada, gambling winnings are treated as a windfall and not taxed unless your gambling winnings are your primary source of income.
This is quite different from the US where winnings are taxed. While my knowledge of U.S. tax is limited, most online poker sites are located outside of the U.S. which adds ambiguity as to the tax treatment.
You seem to have your head on right - as you treat Poker just as an innocent hobby.
However, too be honest, it freaks me out to read about Poker money strategies on one of my "regular reads" financial advice blogs.
If ever your head was to get "loose" - I think you could be in big trouble. I'd rather have a hobby - like golf, curling or tennis - where you really can't go bankrupt from.
ING Direct has US$ accounts paying 2.75% last I looked. I don't know if your PokerBroker will transfer to ING or not.
I don't get it. I thought this blog was about frugality. Suddenly you're talking about your poker winnings? This is not advice the average joe can take with them to the money bank.
Disappointed that this blog has taken a turn for the worst. I'm afraid I won't be reading this blog any more. The content has changed to gambling which is something that I don't advocate nor proactice.
I'm a bit surprised at some of the comments here. I'm not advocating gambling as I mentioned in my previous post. What was intended to be a $20 entertainment cost more than 6 months ago, has grown into a modest sum.
I am now sitting on some US Cash and trying to find a suitable return on investment. Thanks to the reader that recommended ING's bank account. They are currently paying 3% and I'm looking into getting an account
I would just like to throw in a word on your comments that poker winnings are not taxable in Canada unless they constitute your primary source of income. This is not correct. They are taxable if you are considered to be carrying on a business. A key factor in this determination lies in the answer to the question, do you have a reasonable expectation of profit? The existence of a system for the minimization or management of risk may indicate a professional gambler. In this case, the winnings would be taxable and, conceivably, the losses would be deductible. The relation of your gambling winnings to other sources of income are generally not relevant to this determination.
It's a lot more subtle than just merely having a reasonable expectation of profit.
We could go into all the details and the cases if you wish, but below I provide one instance of the court's statement. This comes from http://reports.fja.gc.ca/fc/1996/pub/v1/1996fca0133.html
I note that section 3a is on what constitutes icome tax. Here is the quote:
'Against this background, we are left to pursue the judicial understanding of what items fall outside the grasp of paragraph 3(a). I begin with the recognized exclusionary categories: gambling gains, gifts and inheritances, and the residual category of windfall gains. I shall deal briefly with the first two categories as they provide the underlying framework for the third.
Gambling gains are non-taxable provided the taxpayer is not in the business of gambling: see Graham v. Green, [1925] 2 K.B. 37; Minister of National Revenue v. Walker William, S., [1952] Ex. C.R. 1; Morden, Harry Edgar v. Minister of National Revenue, [1962] Ex. C.R. 29. The classical reason for excluding such receipts from income is that a "bet" is based on an "irrational agreement". A more compelling argument is that a gambling gain does not flow from a productive source. That is, a source that is capable of producing income: see F. E. LaBrie, The Principles of Canadian Income Taxation , (Don Mills, Ont.: CCH Canadian Ltd., 1965), at page 25.'
Post a Comment
<< Home