Players from outside the United States are being advised they may have 30% withheld from their winnings at the World Series of Poker in June and July.
The warning to overseas players was made by Russ Fox – a tax expert at the Las Vegas financial management company Clayton Financial. In an article published on taxabletalk.com, Fox claims that Las Vegas casinos are no longer able to issue Individual Taxpayer Identification Numbers (ITINs) – the forms required by overseas residents to avoid having tax withheld from their winnings.
The source of his information is allegedly a letter sent to a Las Vegas casino last week in which the casino was informed by the IRS it would no longer be able to issue ITINs because of a change in the PATH Act. Fox assumes that if one Vegas casino has received this letter, they all have, including Caesars Entertainment – the casino group responsible for running the WSOP.
Obtaining ITINs from the IRS
In his article, Fox also warns about the difficulty in obtaining an ITIN prior to the event, or renewing an ITIN that has expired. Until several years ago, players residing in countries that have a tax treaty with the United States were able to apply for an ITIN via a Certified Acceptance Agent in their own country. That facility has now been removed and applications for an ITIN have to be made directly to the IRS.
The problem with this process, Fox writes, is that the IRS demands the player´s passport or national identity card is submitted with the application form. As the application could take up to sixty days to process – and is returned by standard mail – any player applying now for an ITIN could be without their passport or national identity card at least until the end of April.
Although in certain cases it may be possible to submit a certified (not notarised) copy of the passport, the process of certifying a passport can also be lengthy – leaving a small window of opportunity between now and the start of the WSOP in which to apply and receive the ITIN before heading out to Vegas. Alternatively, an ITIN can be applied for in person at the Taxpayer Assistance Center on City Parkway in Las Vegas, but players will have to make an appointment first and may still have to wait up to sixteen weeks before receiving the ITIN in the mail.
New Rules Relating to Existing ITINs
What Fox fails to mention in his article is that players who have attended the WSOP in previous years, but who have not used their ITIN on a federal tax return at least once in the past three tax years, will find that their ITIN will have expired and tax will still be withheld from their winnings. The same applies to players with an ITIN issued prior to 2013 with the middle digits of 78 or 79 (i.e. 9XX-78-XXXX).
The process for renewing an ITIN is exactly the same as applying for a new one. Players have to complete a Form W-7 and submit it with their proof of identity (or a certified copy). The IRS has issued advice on how to apply for a renewal of an existing ITIN on its website, and provided some hints about avoiding delays. There is also an international number provided (below) for players requiring specific advice.
Doesn´t Apply to Us Claims WSOP
Shortly after the article was published, the WSOP Twitter account sent a Tweet claiming that it would still be able to issue ITINs to overseas players cashing in WSOP events. No further explanation has been given about why it is exempt from the new regulations, and an update to Fox´s article (after the Tweet had been sent) suggests that the WSOP is wrong in its assessment of the situation.
— WSOP (@WSOP) February 14, 2017
As ever we advise players to seek independent professional advice about tax or legal matters that might affect them when they visit the WSOP. Players wishing to contact the IRS directly can call (1)-267-941-1000 (please note this is not a toll-free number) or email email@example.com. It is recommended that players do not divulge personal information via email.