The IRS can easily see if someone doesn’t report income they are supposed to by matching it against the data they have on a taxpayer, said Steven Packer, a senior manager in the tax accounting group at Duane Morris in Philadelphia, who has fantasy players as clients. If the players he picks online do well in real life, he wins.
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“Under Nevada law today, this is both gambling and sports pool betting”, Laxalt said. The law also labeled gambling as a game of chance and fantasy sports as a game of skill. Customers of the two biggest daily fantasy sports websites – DraftKings and FanDuel – filed at least four lawsuits against the sites in October 2015.
In Nevada, regulators have cited a state statute and issued a cease and desist order to daily fantasy sports sites, telling them they can return when they obtain a gaming license in the state.
Harris also noted that while the new board will play a role in enforcing rules, he said that “the goal of the project is to prevent and pre-empt violation rather than to punish”. It’s a relatively small amount of money that people are paying to play a game that they enjoy and that they invest a lot of time [and] energy [in].
And a smaller firm, Star Fantasy Leagues, expressed concern that it was being left out of the conversation in favor of the larger members.
The chief executive of FanDuel, Inc.is calling on the government to regulate the fantasy sports business.
“It feels nearly like gambling to me”, said McCarthy. It is believed that daily fantasy-sports industry will collect more in entry fees than all the Las Vegas sports books combined. This may or may not be the case, fantasy gambling is requires skill, but sometimes all it takes is luck to make you a millionaire.
In an interview with the Wall Street Journal, Eccles said he believes that the FSTA’s plan didn’t go far enough to protect consumers, and consumer trust was crucial for the industry to continue. But it is intertwined with the industry, as many of its teams have advertising relationships with daily fantasy companies, and Dallas Cowboys owner Jerry Jones and New England Patriots owner Robert Kraft both invest in them.
The nature and legality of daily fantasy sports operations are being debated across the country.
But betting on the ponies is a regulated gaming activity, unlike the online fantasy sports fad of picking winners in National Football League and other major sporting events.
All of this strongly underscores the need for responsible legislation in a widely unregulated industry that rakes inbillions of dollars in revenue every year.
The Miami Dolphins, who partner with DraftKings, said earlier this month that they would re-examine their relationship with the company “if their business model were deemed to be unlawful”.
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Laws should be in place to mandate that fantasy sports operators keep player funds separate from operating cash, that companies have checks in place to ensure no one younger than 18 plays and that inside information can not be misused, Mr. Eccles said.
