Death, taxes, and online casinos.  There are a lot of questions about these topics, especially when they are in conjunction with each other.  Some more than others.  A lot of confusion circles around online casinos, but even more questions are asked about online casinos and paying taxes.

First of all online casinos are not even recognized by the United States government.  It does not seem fair that the government expects gamblers to pay taxes on their winnings from online casinos.  However, law has never been about being fair.  The bottom line is that winnings from online casinos are still income.  There are procedures to accurately paying proper tax from you online winnings.  But, the arguments do not stop there.

Many online casinos are hosted and licensed from Indian reservations such as the Kanhawake Gaming Commission.  This fact is important when it comes to the argument of whether online casinos are even legal in the United States.  It can be argued that when a player visits online casinos licensed by the Native American tribes that they are using gambling services sponsored by Tribes that have rights to offer gaming.  Granted this service is available in the comfort of your own living room.   

That question has not really been made clear in court; however judges do not like to hear the argument.  When a person gambles or purchases something from a company based in another country, does that transaction legally take place in the United States or that other territory.  The Internet may feel old, but it is still new when it comes to laws that apply to it.