Hello, I'm unsure whether I meet the professional gambler classification.
I have reviewed the following ruling, where the taxpayer was found NOT to be a professional gambler:
While many of the facts of my situation are identical to the taxpayer in that ruling, there are some characteristics of my situation that are different to his, which make me hesitant to just assume the same ruling applies to me.
Difference 1: I am a consistently profitable gambler, and I am confident that I will remain consistently profitable for the forseeable future
The ruling states that he did little research and the outcome of his bets was largely down to luck. However this is not the case for me. I am spending at least 1 hour per day researching my bets, sometimes maintaining spreadsheets etc. While luck is still a significant component of the outcome of any INDIVIDUAL bet, due to my large edge and approach to bet sizing, my overall profitablity over longer periods such as eg. the year can no longer be said to be predominantly the product of luck.
Difference 2: The purpose of the activity is, in part, to profit.
The person in the ruling was so addicted to gambling that they would continue to bet even if they were losing money in the long term. For me, while I have a lot of fun gambling and I initially began gambling purely for fun, I have begun to place more importance on profit as the size of my bankroll increases. Likewise if I was no longer able to gamble profitably I would cease gambling or at least drastically reduce the scale of my gambling.
Difference 3: Smaller scale
I have NOT bet $950,000 like the taxpayer in the ruling. I WISH I had that kind of money. My total capital involved in gambling activities is approximately $50,000 but is growing rapidly due to high ROI. If scale is a determinant of whether my gambling activities are "business-like", some clarity on what metric is used (bankroll size or annual profit?) and what the threshold is for that metric before it constitutes "business-like" scale would be appreciated
I personally believe that I do not meet the definition of a professional gambler this financial year because my gambling income is not "job-like" in scale, which in my mind disqualifies my gambling from being a profession (ie. if you cannot support yourself with an activity, you are not a professional). However, I am anticipating that next financial year my gambling income WILL become "job-like" in scale which is why I am seeking clarity on the issue ahead of time.
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