We get mail:

I moved to California in 2012, and earned just $5,000 while in California versus a lot of money outside of the state. Yet those robbers want me to pay based on my overall income. This can’t be right.

Each state has a different formula for part-year income tax. California calculates your tax based on all the income having been earned in California, and then multiplies this by the ratio of California income to total income. So if 5% of your income was earned in California, and the “total” tax would be (say) $100,000, your California tax would be $5,000. It’s not as simple as that–exemptions and deductions also figure into this–but that’s the general idea.

In any case, that’s how California determines the tax, so assuming your tax professional is doing it right you have to live with the results.

I am retired (70) & play poker as a hobby. I recently traveled to Oregon to play in Money added tournaments @ Wild Horse Casino. I won the first tourn played & received a W2G for just under $6000. This is a “first” for me (W2G). When paying my taxes, will I be able to write losses which are “not” proven w/ receipts (both online & casinos)? I am from neighbor Washington state (no state income tax).

Congratulations. If you keep a gambling log (a written gambling log should be kept for your live play; you can use an electronic log for online), you will be able to take your gambling losses up to the amount of your winnings as an itemized deduction on Schedule A. Note also that you may need to file an Oregon tax return for your winnings that are Oregon-source.

A written gambling log should contain the date, casino name, game played, table number (not needed for tournaments), start time, end time, and result. It should be contemporaneously written.

I play online poker from outside of the United States but will not qualify for the Foreign Earned Income Exclusion for 2012. I had over $60,000 in my Moneybookers account but never had $10,000 in any other account. Do I need to file an FBAR?

Moneybookers is considered a foreign financial account. Not only must you file an FBAR, it’s probable you will need to file Form 8938, too. This is a complex area of tax law; make sure you discuss this with your own tax professional. Note that the FBAR is filed separately from your tax return and is due by June 30th. There are no extensions allowed for filing an FBAR.

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