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h1b and schedule c on tax return - i485 risk

Discussion in 'Individuals' started by 6850_6850, Apr 4, 2013.

  1. 6850_6850

    6850_6850 Junior Member

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    I have a steady gambling income. It is little bit nuanced, but think about poker as an example. You make half a dozen trips per year to Las vegas to participate in major poker tourneys. You keep detailed track of your wins/losses. Then to optimize the taxes you file it as schedule C to deduct travel expenses. This is fully legitimate way from the fiscal standpoint. All of my playing friends are approaching it this way, many of them got audited over the years, as IRS is always suspicions of cash income, but legal framework is not questionable. However all of my playing friends are US citizens.
    For me it is different, as I am on h1b. I believe, Schedule C in essence means operating for-profit business without setting up a legal entity. Is it a violation of authorized employment? I should have thought about it before filing schedule c for the last couple of years. But what happened happened. I don't know whether USCIS is going to catch it as I already submitted all my previous tax returns as a part AOS file. Any thought on potential remediation or proactive action?
    Additional facts - gambling income fluctuated from 10 to 35 grand a year with me offsetting most of it via plane tickets/hotel charges/per diem. The above gross profits made about ~10% of my regular (h1b) inclome. Collectively over the years it is still below 180 days for total gambling trips duration. Do I qualify for 180 days exemption for unauthorized employment. If I reach out to IRS, proactively re-file everything as pure gambling income, pay increased taxes and penalties, and then resubmit corrected tax returns to USCIS, will it help? Do they allow proactive remediation? Or do I need to wait until they notice it and issue NOID?
    Going forward, is there any chance to get part-time h1b for gambling activity? I have been doing it for a while, and I have a lot of connections. I have a lot of friends who are doing it full-time. i just never wanted to do it for full living. I guess I am just a hostage of all my previous investments in education from world-class schools and continuous mice race in terms of climbing corporate ladder. Thoughts?
     
  2. Ron Gotcher

    Ron Gotcher Attorney at Law

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    Re: h1b and schedule c on tax return - i485 risk

    I really don't see this as an "unauthorized employment" situation. Just report your income as required by law. If the issue ever comes up, you can explain it then. I can't envision any situation where simply reporting your income would trigger an immigration related inquiry.
     

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