Technology can change what a business records without automatically changing what a tax rule requires it to report. The IRS's March 2015 proposal defined electronically tracked slot play through an establishment-controlled system recording a particular person's winnings and wagers. Its December 30, 2016 final rule did not adopt the proposed tracked-slot rules. That distinction frames this December 31 weekend account. [2016-31575][2015-04437]

The proposed mechanism was more demanding than simply identifying a large payout. It required net session winnings of at least $1,200 and at least one individual gross win of $1,200 or more. The session was confined to the same game type, establishment and local calendar day, and could end earlier. Those conditions explain the proposed design; they are not a technology mandate imposed by the final rule. [2015-04437][2016-31575]

The final action instead offers optional aggregation of qualifying reportable payments of the same game type to one payee within a reporting period. Individual entries and signatures still support the combined return. Payments to foreign persons, specified other-beneficiary situations and backup-withholding payments are excluded. The mechanism is consolidation of eligible reporting, not universal subtraction of losses or inclusion of every small win. [2016-31575]

For an operator, the analytical question is which work changes: preparing returns, maintaining records or collecting identification. The documents define those duties but do not establish realized savings. December 30 effectiveness also differs from January 1, 2017 applicability for payor-selected reporting periods; other provisions apply from December 30. Proposal and final rule are one IRS chain, not independent confirmation of a cheaper compliance system. [2016-31575][2015-04437]

Source documents

  1. Information Returns; Winnings From Bingo, Keno, and Slot Machineshttps://www.govinfo.gov/content/pkg/FR-2016-12-30/html/2016-31575.htm
  2. Information Returns; Winnings From Bingo, Keno, and Slot Machineshttps://www.govinfo.gov/content/pkg/FR-2015-03-04/html/2015-04437.htm