Tennessee legalizes -- & taxes -- fantasy sports gambling

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Tennessee legalizes -- & taxes -- fantasy sports gambling

Thursday, April 28, 2016

It's a wonderful day. In preparation for the 2016 National Football League draft that starts tonight at 8 p.m./7 Central, we step back from the drama of the presidential campaign and get ready for the drama of which young men will become instant millionaires.

I'm a Dallas Cowboys fan, so the draft fascination for me is what crazy move owner Jerry Jones might make. (Photo by Kay Bell; Cowboys vs. Lions, Nov. 21, 2010, at Jerry World)

As ESPN senior writer Mike Sando notes, "Like its predecessors, the 2016 NFL draft has proved to be unpredictable and, come Thursday night, will crush even the best of prognostications. That is one of the few draft predictions worth taking to the bank."

The other thing you can take to the bank today is that the NFL draft is also the unofficial kickoff of the fantasy football season.

And with that comes the persistent question as to whether fantasy sports, especially the daily versions, are gambling or just good clean sports fun. That distinction is bedeviling state lawmakers, law enforcement officers, sports leagues and sports fans nationwide.

The NFL-state fantasy divide: The NFL itself is part of the growing involvement in fantasy games. Its official website is offering the general managers of online teams its take on six fantasy football sleepers in the 2016 NFL draft.

The NFL's embrace of fantasy sports runs counter to the attitudes of several states.

In Texas and New York, for example, the states' top law enforcement officers contend that fantasy sports sites, specifically their daily contests, violate the states' gambling laws.

New York is duking it out in court with fantasy sports giants FanDuel and DraftKings. The companies have agreed to suspend paid contests in New York until an appellate court hearing in September.

Here in football mad Texas, FanDuel will stop accepting paid entries for cash prizes in the state on May 2. The agreement follows the AG's opinion in January that paid online fantasy sports contests are illegal under current Texas law. DraftKings is continuing to fight Texas' position.

Changing the law: Tennessee, however, has decided to change its law rather than fight with fantasy sports operators and their customers.

The Volunteer State's General Assembly just legalized, and will tax, fantasy sports gambling.

The Fantasy Sports Act (SB 2109) is now awaiting Gov. Bill Haslam's signature. Once it becomes laws, it will not only exempt fantasy sports from the state's gambling laws, but also will establish a 6 percent privilege tax on the amount of total entry fees collected from all online fantasy sports participants, minus winnings paid to contest participants.

The bill was prompted by the Tennessee AG's determination that betting on virtual line-ups of professional athletes amounted to illegal gambling.

Most of the state's lawmakers think that the law is wrong. So they changed it.

The Fantasy Sports Act sailed through the Assembly, passing the House on April 18 by a 67-17 vote and the next day easily clearing the Senate by a 27 to 2 margin.

More states could follow: Other states are considering the legalization and taxing of online sports games. Pew Charitable Trusts research reports that at least 30 states either have approved or are considering legislation to bring the fantasy games under state governance.

But while the games generate beaucoup cash -- more than $2 billion last year in entry fees, which Eilers & Krejcik Gaming LLC says could reach $14 billion by 2020 -- states that decide to condone (and tax) the games shouldn't necessarily expect to see much of that money flow to their treasuries.

Tennessee's tax is designed to generate just enough money to pay for the two new inspectors that the law requires be hired.

Still, savvy fantasy team owners will owe taxes, state and federal, on their winnings.

And the good public relations in legalizing a popular sports outlet is priceless.

You also might find these items of interest:

Posted on Thursday, April 28, 2016 at 01:51 PM in Gambling, Sports, State/Local, Taxes | Permalink | Comments (1)

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Must watch this seasons NFL

Posted by: Ascah Kasisi | Wednesday, July 06, 2016 at 03:17 AM

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Today's Tax Tip

10 December tax moves — I love Santa Claus, but even the Jolly Old Elf isn’t magical enough provide the tax solutions you asked for in your letter to him. You’re going to have to make some tax moves this December yourself, like these 10 suggestions. (Dec. 1, 2024)
The 2024 Tax Tips offer ways to file your annual return, along with post-filing advice, important tax news and, of course, ways to cut your current tax year bill. You'll find the monthly assemblages on their own respective pages: January, February, March, April, May, June, July, August, September, October, November and December. Remember, tax tasks and tips don't stop after you file your annual return!

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(the blog title totally makes sense now, right?). Professional journalist. Tax geek.
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Tax Season 2024 Final Push

It's over! The final 2023 tax year extended filing deadline has passed, unless you get more time because your filing due date was extended further by a natural disaster like the three hurricanes that have made landfall in Florida this fall.

For most of us, though, the passage of Oct. 15 means it's time to focus on the tax return we'll file next year. We have until Dec. 31 this year to make moves that will reduce our already accruing 2024 tax bill. The monthly tips and reminders a little further down this column suggest ways to do just that.

Finally, keep an eye on the countdown clock just below. It's keeping track of just how many days are left for us to make these tax moves.
Note: I'm in the Central Time Zone, so adjust accordingly for where you live.

Time for Tax Tasks

Ho 🎅 Ho 🎅 Ho!
December is here!
You better watch out. You better not cry. But you better make some year-end tax moves this December or next April 15 could turn out to be the tax equivalent of Santa Claus putting coal in your stocking.

Click image to hear a musical Santa message from The Boss, Bruce Springsteen.
OK, St. Nick can't deliver a festively wrapped, already prepared tax return for you (unless he's even more magical than I think!) to file next year, but he does have a tax connection.
Santa's tracking of naughty and nice boys and girls basically is the same method that the Internal Revenue Service uses. That's why we all need to be nice, especially to ourselves, in this final month of the year by making some important tax-saving moves. Let's get to it!
Dec. 1: It’s here. The last month of the year, meaning the last 31 days to make tax moves that could shave some off your 2024 tax bill, as well as set up 2025 as another saving, and easy, tax year. You could make things even easier on yourself if you opt next filing season to turn over your taxes to a professional. The key is picking the perfect tax pro for your filing (and more) needs. And you need to start your search now, as the good tax pros’ client lists fill up fast. If you can hire one soon, there’s a December bonus. You might get some year-end tax tips!

Dec. 4: In the meantime, check out these 10 tax moves to make in December. They could be the perfect tax present to give yourself.

Dec. 10: Do you work as a server at a restaurant or at any other establishment where gratuities from customers are part of your compensation? I hope you get all the tips you deserve for doing your job well. Remember, though, that those tips are taxable income.

Whether you're dining at your favorite eatery or getting food delivered to your home, if a tip isn't included on your restaurant or delivery bill, click the image above to calculate how much to tip the person who brought it to you.

And if you got at least $20 in gratuities in November for your extraordinary services as a food server or hair stylist or parking valet or whatever job where tipping is common, you must report that amount by today. Use Form 4070 to let your employer know the total tips you took in last month.

Dec. 13: It’s the holiday season, full of joy and peace and goodwill toward all. So what the heck is a Friday the 13thh doing in December? Don’t worry, as least not about tax fears and superstitions. Check out the tax truth about these 13 tax misperceptions. They’ll help get you through today and help you be a fearless taxpayer year-round.

Dec. 15: Christmas is just 10 days away! If you're still shopping for gifts, you're probably searching for the perfect present online. But beware and be wary. Internet crooks also are logged on, looking to steal your money and identity. Many of the holiday scams use the same techniques as tax scammers employ. Any personal information they get now can be used at tax time to file a fake return in your name and claim a fraudulent refund. So be careful out there, now and next filing season, and, well, unfortunately all the time.

Dec. 19: Are you taking on multiple gig jobs to make some extra holiday cash to pay for all those online orders? Those added side hustles mean you're an independent contractor. And that means you're responsible for paying income taxes due on the money, as well as any self-employment tax. In most cases, that means paying estimated tax on these end-of-year earnings by Jan. 15, 2025, to avoid a possible penalty for not paying as you earned the money.

Dec. 23: It's Christmas Week! That means holiday treats, final decorations — or first, if you wait until the very end to get a tree — and frantic last-minute shopping! Rather than worry about how you'll get the perfect gift under the tree on time, consider instead giving some easy tax-favored presents. Open a Roth IRA for your child or grandchild who earned some money this year. Or pay tuition by Dec. 31 for classes that will start in the first quarter of 2025.

Dec. 24: Christmas Eve!
No taxes tonight. It's early to bed for kiddies of all ages. Santa's on his way!

Click image to watch NORAD track Santa's Christmas Eve delivery route.

Dec. 25: Merry Christmas! My gift to you is another day without tax thoughts.
Just enjoy the holiday and your family and friends.

Dec. 26: Happy Boxing Day. This unofficial holiday on St. Stephen's Day is celebrated by additional giving.
If you donate to your favorite charity on this Boxing Day or any other day by Dec. 31, on your 2023 taxes you'll have to itemize your gifts on Schedule A to claim them. If you don’t have enough expenses to exceed your standard deduction amount this tax year, consider delaying your charitable contributions until early January as part of a tax deduction bunching strategy.

Dec. 31: This is it. The drop-dead deadline to make most 2024 tax moves. A quick and easy action today is to zero out your medical flexible spending account (FSA) by buying over-the-counter medications for which the funds can be used. This is especially important if your employer doesn't offer a grace period to use the money or let you roll some FSA money over into 2025. Without those alternatives, you'll lose any FSA funds you don't use.

Done? Great! Make sure the champagne is chilling and settle in for your New Year's Eve party or a cozy night at home with your friends and loved ones. Either way, cheers and Auld Lang Syne as the ball drops at midnight.

Small Business Tax Calendar: Important filing, deposit and record keeping dates throughout the year that your company needs to know. You can get more tax calendar information at the IRS' online calendar page and view the full year's important business and individual tax dates in IRS Pub. 509.

State Tax Help

Don't forget your state taxes!
Forty-three states and D.C. collect personal income taxes. But even if you live in of the seven states without an income levy, you still face other state (and local) taxes.

State Tax Departments provides links to your state's Web page. The companion page, Tax Tidbits, is the compilation of blurbs about each state's tax laws. And for more state tax news, check out all our state tax bloggings.

Tax Forms

Thanks to our increased use of tax preparers and computer software, many of us don't see our tax forms until we sign and file them. But knowing what's on these documents, either in paper or digital form, and why the IRS wants it is key to understanding our tax system. And knowledge definitely is power, especially when it comes to tax savings. Find this valuable information in the ol' blog's special Tax Forms 2024 page.

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Coronavirus has wreaked havoc
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These five Coronavirus (COVID-19) and Taxes pages have details:
March-July 2020
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…and so it continues into 2023
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You can find medical coronavirus resource links in the next section.

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December 2024

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Tell it to the Hill

While it's easy to rail at the IRS, for the most part we can thank — or blame — Congress and the White House for our tax laws. So if you have an issue with tax legislation or want a tax bill passed, you need to let your federal legislators and the White House occupant know of your concerns. You can find out who in Washington, D.C., to contact (and how), as well as get information on your local lawmakers for matters, tax or otherwise, closer to home, at USA Gov.

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