Biggest News for Horseplayers & Bettors in Decades

Treasury/IRS Issue Updates Tax Rules

The U.S. Treasury Department and the Internal Revenue Service (IRS) today announced that they will formally adopt modernized regulations regarding the withholding and reporting of pari-mutuel proceeds. The National Thoroughbred Racing Association(NTRA) has long pressed for these updated regulations that will allow horseplayers to keep more of their winnings, thereby increasing the amount wagered on U.S. pari-mutuel racing by as much as 10 percent annually, or upwards of $1 billion, according to independent estimates. The new rules were posted late Monday afternoon as a Public Inspection Document. They are scheduled to be officially published in Wednesday’s edition of the Federal Register and will go into full effect by no later than Nov. 14, giving racing associations, totalisator companies, and advance deposit wagering (ADW) operators up to 45 days to implement these important changes; however, some may elect to start as soon as Thursday.

Washington DC“These landmark U.S. Treasury regulations will have an enormously positive impact on horseplayers, the racing industry, and the federal government,” said NTRA President & CEO Alex Waldrop. “I am extremely proud of the NTRA’s legislative team for spearheading this effort, which will prove to be among the most meaningful regulatory advances made by our industry in decades. The results of this much-needed measure will be horseplayers keeping more of their winnings, racetracks generating more pari-mutuel handle, and government collecting additional tax revenue. This is a sure bet where everyone wins!”

Added Waldrop: “This day would never have come without the persistence of Thoroughbred racing’s friends in Congress, especially Rep. John Yarmuth of Kentucky, Rep. Pat Meehan of Pennsylvania, Senate Majority Leader Mitch McConnell and our many bipartisan supporters on Capitol Hill. We also are indebted to the industry stakeholders and thousands of customers of Thoroughbred racing who signed our petition or submitted public comments in favor of these changes.”

Under the new regulations, the IRS will consider the inclusion of a bettor’s entire investment in a single pari-mutuel pool when determining the amount reported or withheld for tax purposes, as opposed to only the amount wagered on the correct result.

For example, the amount wagered by a Pick Six player who hits with one of 140 combinations on a $1-minimum wager now will be $140, which is the total amount bet into the Pick Six pool. This more accurate calculation will remove the significant reporting and withholding obligations on horseplayers and the unnecessary paperwork for the IRS that was a result of the prior rule that used only the $1 bet on the single winning combination as the amount wagered.

Chris Larmey

“This is a major victory for all pari-mutuel wagering customers,” said Judy Wagner, the Horseplayers’ Representative on the NTRA Board of Directors and winner of the 2001 National Horseplayers Championship (NHC). “It would not have occurred without the leadership of the NTRA and the support of thousands of horseplayers who actively participated in the process to modernize these regulations.”

In 2015 longtime horseplayers Judy Wagner and Chris Larmey traveled to Washington D.C. to discuss this vital issue with the Treasury Department.

The amended regulations, advocated by the NTRA and its legislative team, define the “amount of the wager” to include the entire amount wagered into a specific pari-mutuel pool by an individual – not just the winning base unit as is the case today – so long as all wagers made into a specific pool by an individual are made on a single totalisator ticket if the wager is placed onsite. The modernized regulations will have the same positive results for ADW customers and will not impact how those wagers are currently made.

View the full text of the new rule under section 3402(q) of the Internal Revenue Code here: https://s3.amazonaws.com/public-inspection.federalregister.gov/2017-20720.pdf.

The NTRA has pushed for the modernization of pari-mutuel withholding and reporting rules for several years. As more and more pari-mutuel wagering was directed toward exotic wagering pools it become clear that the tax rules were becoming an increasing and unfair burden on horseplayers as those outdated rules significantly increased the incidence of winning tickets subject to withholding and reporting. These new rules are the product of all the work the NTRA, and other industry stakeholders, undertook with Congressional representatives and Treasury and IRS officials.

“This represents a great triumph by the entire NTRA legislative team, including the bipartisan Horse PAC, which played an instrumental role in the passage of these regulations that will benefit all segments of the industry,” said Horse PAC chairman William S. (Bill) Farish. “We thank the hundreds of individual stakeholders who contribute to Horse PAC; they played a major role in today’s victory.”

Waldrop noted that the NTRA has been working behind the scenes since January with industry groups – including totalisator companies, ADWs, and racing organizations – to ensure a smooth implementation for customers.

“For the industry to fully realize the benefits of modernized regulations for pari-mutuel withholding and reporting it is essential that we deliver a seamless transition to our customers,” he said. “We are optimistic that the industry will be fully prepared to institute these landmark changes by no later than November 14.”

Congratulations to all horseplayers nationwide!

IRS Proposes Major, Positive Changes for Horseplayers

Special thanks to my friends and fellow horseplayers Judy Wagner and Chris Larmey , who were very instrumental in getting this done.  Judy and Chris traveled to Washington D. C. this past year to meet with U.S. Treasury officials to discuss the problems with the current pari-mutuel tax system and propose solutions for all of us players.  ~ Rich Nilsen

DEPARTMENT OF TREASURY AND IRS ISSUE PROPOSED REGS TO MODERNIZE PARI-MUTUEL WITHHOLDING AND REPORTING

Lexington, Ky. (December 29, 2016) – The Department of Treasury and Internal Revenue Service (IRS) today issued newly proposed regulations relating to withholding and reporting with respect to pari-mutuel winnings. The 31-page Treasury document, entitled“Withholding on Payments of Certain Gambling Winnings,” accomplishes the goals started and spearheaded by the NTRA more than two years ago. The effort to this point has included meetings between the NTRA and Treasury and IRS officials, visits to Washington by horseplayers, grass roots campaigns and direct contact involving thousands of industry stake holders, including bettors, as well as involvement by numerous Members of Congress, Governors and other elected officials.

Chris Larmey

The proposed regulations clarify ‘the amount of the wager’ to include the entire amount wagered into a specific pari-mutuel pool by an individual—not just the winning base unit as is the case today—so long as all wagers made into a specific pool by an individual are made on a single totalizator ticket if the wager is placed onsite. The proposed regulations would have the same positive results for Advance Deposit Wagering (ADW) customers and would not impact how those wagers are currently made.

The proposed regulations will positively impact a significant percentage of winning wagers, particularly those involving multi-horse or multi-race exotic wagers, and result in tens of millions of dollars in additional pari-mutuel churn.

The proposed regulations will undergo a 90-day comment period and it is conceivable that they could be in place prior to the 2017 Triple Crown. As was the case during a similar comment period in 2015 that attracted nearly 12,000 comments, the NTRA next week will establish a convenient and simple method for industry stakeholders to encourage enactment of the proposed regulations.

In its 31-page rulemaking document, the Treasury and IRS cited numerous specific examples provided by the NTRA as reasons for the need to modernize and also referred to the many comments it received from individuals in support of the proposed changes.

“This is a tremendous step forward in our ongoing efforts to modernize pari-mutuel regulations to accurately reflect today’s wagering environment,” NTRA President and CEO Alex Waldrop said. “The NTRA remains thankful to everyone who has engaged in this process, including numerous industry stake holders, horseplayers, Members of Congress, Governors and other elected officials, especially Congressmen John Yarmuth (D-KY) and Charles Boustany (R-LA), who led the congressional effort. A unified message has gotten us to this point and we encourage everyone to continue to work through the channels we will be establishing as we seek to push these proposed regulations across the goal line.”

The complete Treasury and IRS rulemaking document is posted on NTRA.com and can be accessed here.

NHC Begins Today. Crist, Wagner Added to NHC Hall of Fame

NHC generic logo The Daily Racing Form/NTRA National Handicapping Championship begins today at Treasure Island Casino in Las Vegas, where over 500 players will compete for $2.7M in prizes.  In its 17th year,  the event is the most important tournament of the year for horseplayers and is the culmination of a year-long series of NTRA-sanctioned local tournaments conducted by racetracks, casino race books, off-track betting facilities and horse racing and handicapping online sites, each of which sends its top qualifiers to the national finals.

LAS VEGAS (Wednesday, January 27, 2016) Steven Crist, the longtime Daily Racing Form publisher and columnist who was the impetus behind the formation of the National Handicapping Championship (NHC), and Judy Wagner, winner of NHC II in 2001 and the first horseplayers’ representative on the NTRA Board of Directors, have been selected for induction to the NHC Hall of Fame, the National Thoroughbred Racing Association (NTRA) announced today.

Crist and Wagner will be inducted at the NHC Champions Dinner on Saturday at the conclusion of the 17th Daily Racing Form/NTRA National Handicapping Championship Presented by Racetrack Television Network and Treasure Island Las Vegas, set for Thursday to Saturday at Treasure Island.

For nearly 35 years Crist, of Long Island, N.Y., has been the most visible and outspoken horseplayers’ advocate in the United States. He has been the publisher and a columnist for Daily Racing Form since 1998 and throughout the NHC’s entire existence. Previously, he covered racing for The New York Times from 1981-1990; was founding editor-in-chief of The Racing Times in 1991-92; and a vice president of the New York Racing Association (NYRA) from 1994-97. His horseplayer-friendly accomplishments include writing the legislation for nickel breakage and instituting full-card simulcasting at NYRA. He is the author of multiple books and tutorials on handicapping, as well as a memoir, Betting on Myself: Adventures of a Horseplayer and Publisher.

“When we started the NHC almost 20 years ago, the idea was simply to find a way to recognize horseplayers at the Eclipse Awards,” said Crist. “We had no idea it would turn into the rich and compelling tournament it has become. It is an honor to be recognized for having had a hand in its creation.”

Wagner, of New Orleans, has been one of America’s most recognizable handicapping contest players since her win at NHC II. She is among the NHC’s all-time leaders with 12 appearances at the finals in Las Vegas. She finished second to her husband, Bryan Wagner, in the 2009 NHC Tour. In recent years she has foregone NHC and NHC Tour eligibility to advocate for bettors as the first horseplayers’ representative elected to the NTRA Board of Directors. Wagner is a former horse owner and has been a member of the Louisiana State Racing Commission since 2007. She has lobbied on behalf of horseplayers in Washington, D.C., and in numerous editorials and public appearances. She remains the only woman to win the NHC.

“I am overwhelmed by this honor, to say the least, and the gratitude I feel is difficult to describe,” Wagner said. “In January of 2001 when I won NHC II, the NTRA allowed a door to be opened for me that has led to many more doors being opened in the sport I love. The friendships I have made on all levels of racing will always be special and last a lifetime. I look forward to being a part of making our sport stronger in the future.”

Wagner also expressed her appreciation to her husband, Bryan Wagner, the 2009 NHC Tour winner who took Judy on her first visit to a racetrack, Fair Grounds, on a date in 1994.

Crist and Wagner join last year’s inaugural NHC Hall of Fame inductees Mike Mayo and Ron Rippey. Hall of Fame inductees are chosen by the NTRA in consultation with the NHC Players’ Committee.

The main criteria for the NHC Hall of Fame are as follows:

  • Competed in NHC-sanctioned tournaments;
  • Played consistently well over a period of time;
  • Gained the respect of peers;
  • Or, for tournament players and non-tournament horseplayers, contributed to the overall growth and success of NHC tournament play, with indelible positive and lasting results.