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Tax on a Slot payout

brisbane australia
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357 posts
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Tax on a Slot payout

I have a friend who has just returned to Australia from the US. While she was in Vegas she won a jackpot of just over $1200 and (to her amazement) had tax taken out. Can she claim that back from the US tax office and if so, how, Thanks

Moana, Australia
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1. Re: Tax on a Slot payout

I'm curious to the answer of this. Did she have to pay much tax??

Toronto, Ontario...
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2. Re: Tax on a Slot payout

The answer may be tied to whether Australia has a reciprocal tax agreement or tax treaty with the US. Canadians who win jackpots and have the IRS percentage held back can fill out a form and apply when they get home to a refund of the amount withheld. Canadians do not have a treaty that exempts them from paying the IRS withholding tax but does a have reciprocal agreement on paying income taxes on in this case casino wins, or gains. If Australia does not have a treaty or reciprocal tax agreement with the US, then your answer may be NO. Check with your Ministry of Finance or Taxation.

As for the percentage withheld, it's a cool 30% for foreigners.

Toronto, Ontario...
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3. Re: Tax on a Slot payout

Sorry Kylie and Taylorpat. I had a feeling the answer was no, but here is a c/p from the US Embassy/Canberra website: the Australian/US tax treaty does not allow recovery of any US tax withheld from gambling winnings.

"Can an Australian citizen (non-resident alien) claim back the 30% tax withheld by the U.S. government on gambling winnings from a U.S. casino?"

No, an Australian citizen (non-resident alien: defined as a person who is not a citizen or resident of the United States) who has won money gambling on a holiday trip to the United States cannot claim back the 30% tax withheld by the United States government.

Sorry again. I guess 70% of a big win is better than no big win at all.

Cheers.

Wisconsin
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4. Re: Tax on a Slot payout

Play smaller games with jackpots under $1200 and you won't have to deal with the taxes.

I'm not sure, but you may be able to file US taxes and get some refunded, since no one with only $1200 in income will have to pay significant taxes under normal circumstances. The tax rate up to $8,925 is only 10%, although there are Social Security and Medicare taxes that have no lower limit. I'm not sure how that would affect someone who doesn't qualify for either.

Unfortunately, it's a matter for a tax specialist.

UK
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462 posts
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5. Re: Tax on a Slot payout

The yanks really do want their cake and eat it as well. They welcome the tourist dollars with open arms yet should you get lucky enough to win and look like you're going to be taking a bit more home than you came with then WALLOPP... they hit you with a home grown tax to make sure they are still on top.

Norfolk
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115 posts
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6. Re: Tax on a Slot payout

I was under the impression the some casino's will do the paperwork for you which enables you to take the full win home.

Edited: 11 May 2014, 12:39
Brighton
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257 posts
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7. Re: Tax on a Slot payout

I won my first hand-pay at the Mirage last month. The attendant sorted all of the paperwork out, took about 20 minutes and I was given the full amount. He told me the USA has a treaty with the UK.

I didn't take it all home but that was my fault! Those pesky slots! lol

brisbane australia
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357 posts
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8. Re: Tax on a Slot payout

The payout was just a bit over $1200 so a bit less and it would not have been a problem. Also I think it may be better to win on the tables and cash those $100 chips in a few at a time or is Big Brother always watching.

Thanks for your help - I will pass the answers on but I don't think she will be too happy.

Vancouver, Canada
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9. Re: Tax on a Slot payout

The UK has an agreement with the USA, that's why they did the paperwork then and there and the full amount was paid. Canada has a different agreement. They will hold back 30% and we have to apply for an ITIN (individual tax identification number) when we get home and apply to get the money back.

brisbane australia
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357 posts
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10. Re: Tax on a Slot payout

So does this mean that the Americans and the Poms have kissed and made up since the Boston Tea Party (the original one)?