Earlier today, the IRS released proposed regulations under Section 6041 which discuss reporting requirements for winnings from Bingo, Keno, and slot machine play. Under the proposed regulations, the reporting thresholds for such winnings (other than electronically tracked slot machine play) remain the same as under the existing regulations ($1,200 or more in the case of one Bingo game or slot machine play, and $1,500 or more in the case of one Keno game). However, the IRS notes that advances in technology since the existing rules were adopted may overcome the compliance concerns that prompted the higher reporting thresholds and may warrant reducing the thresholds to $600, consistent with other reporting thresholds under Section 6041(a). The IRS specifically requests comments regarding the feasibility of reducing the reporting thresholds, whether electronically tracked slot machine play should have a separate reporting threshold, and whether the threshold amounts should be uniform for Bingo, Keno, and slot machine play.
The proposed regulations also include new rules for determining the reporting threshold for electronically tracked slot machine play. Under the new rules, gambling winnings for electronically tracked slot machine play must be reported when two criteria are met: (i) the total amount of winnings earned from electronically tracked slot machine play during a single session netted against the total amount of wagers placed on electronically tracked slot machines during the same session is $1,200 or more; and (ii) at least one single win during the session (without regard to the amount wagered) equals or exceeds $1,200. The IRS released Notice 2015-21, which contains further information on computing gross income attributable to electronically tracked slot machine play.
Comments on the proposed regulations are due by June 1, 2015. A public hearing is scheduled for June 17 at 10 a.m.