Taxing Intrastate Tribal Poker in California


With online poker refusing to leave the legislative stage in Sacramento, and with many of California‘s biggest gaming tribes pushing hard for a seat at the table, one questions looms: Will the state tax the money that tribes and their members make off of online poker?

It‘s a question up to the Legislature and governor, if they decide to finally go ahead with online poker franchises for California citizens.

"It would depend on how the bill is written," said Allison Harvey, director of governmental affairs for the United Auburn Indian Community, one of the California‘s largest casino gaming tribes. "Since it‘s not a part of federal law, they would have to do it through state law."

It‘s not a question that will likely make a huge difference in the state‘s looming budget deficit. But for individual tribal members, it could mean a big difference in income. For many tribal members, casino incomes aren‘t subject to taxation by the state — but only if the person is a tribal member living on their own tribe‘s reservation and the casino is also located there.

This distinction saves significant money for many of the estimated 3,500 tribal members receiving "per capita" payments from casino compacts. Since many of these people receive upwards of $20,000 a month, a significant portion of their income could be hit by California‘s 9.5 percent top marginal tax rate.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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Sanford Millar
Law Offices of Sanford I. Millar

Experience and Qualifications: Over 30 years of experience in domestic and international tax... View Profile »

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