How the Tax Form Trigger Increase Would Affect Big Slots Winners | Night life
Slots and video poker players who have won jackpots of $1,200 or more know the drill.
When the winning combo appears, the machine freezes. A slot attendant checks things out, disappears for a few minutes, and reappears with an IRS W2-G form to sign. Until you sign the form, the casino is not authorized to pay out your jackpot.
It has been that way since 1977, when the $1,200 threshold came into effect.
What would it mean for players if this threshold were to increase to $5,000? My friends at Strictly Slots magazine passed on questions from a reader who zeroed in on the problem.
The questions come as the bipartisan Shifting Limits on Thresholds, or SLOT, law makes its way through the U.S. House of Representatives. The bill, introduced in March, follows a directive from Congress in December 2020 asking the Treasury Department to consider increasing the tax form trigger.
With inflation, it would take about $5,788 today to have the purchasing power of $1,200 in 1977, and $1,200 today equals about $248 when the threshold was established.
There’s no guarantee that Congress will act, but what if it does? The reader raised these questions:
If the threshold is raised to $5,000, does that mean my jackpot of $4,000 for a royal flush on a dollar video poker game or $1,600 for four Aces on a Double Double Bonus $2 Poker will be credited directly to the machine?
Answer: An increase in the tax reporting requirement would mean that jackpots of up to this amount COULD be credited to your machine. That doesn’t necessarily mean they would.