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Taxable Super Bowl bets

By Kay Bell · Bankrate.com
Friday, February 4, 2011
Posted: 2 pm ET

The ice and snow that this week blanketed two-thirds of the Lone Star State (we got 3/4 of one inch overnight here in usually moderate Austin) tried to upstage Dallas' big event, but the football gods intervened.

The storm system has moved eastward and it looks like Super Bowl XLV will go on without weather worries.

Of course, the plan always was for the roof on Jerry Jones' joint, aka Cowboys Stadium, to be closed. But the folks who ponied up hundreds (at last report, scalpers were asking $350 per ducat) to watch the NFL's championship game on big TV screens outside in the Party Plaza are much happier today with forecasts calling for sunny and near 50 degrees. A few $10 beers and they won't feel anything, much less a little chill.

This collision of cold fronts and pigskins got me thinking about whether the Las Vegas sports books were taking bets on the weather. Probably.

One of the great things about the Super Bowl is that even if the game itself is not that exciting (which happens all too often), there's plenty of hoopla to distract us. And gamblers take advantage of that.

Prop, short for proposition, bets are all the rage during big sporting events. Here you can bet on actual game-related occurrences, such as whether the Green Bay Packers' Aaron Rodgers or the Pittsburgh Steelers' Ben Roethlisberger will throw the first Super Bowl XLV touchdown or what the final score will be, or you can bet on all sorts of things only remotely related to the game.

This includes how long it will take Christina Aguilera to sing the national anthem, whether Fergie of the Black Eyed Peas will sport a Dallas Cowboys Cheerleader outfit when the band performs at halftime and whether a punt will hit the ginormous television screen that hangs over the football field.

If any of those bets, either honest-to-goodness game-affecting actions or those created just for the show, pay off, the winners should declare the winnings as taxable income.

Of course, we all know that unless the bet is a big one paid by a Vegas casino, the Internal Revenue Service isn't going to find out about it. That's too bad, since collection of taxes on even a fraction of the billions of dollars changing  hands this Super Bowl weekend could help reduce the federal deficit.

Maybe Treasury Secretary Tim Geithner, IRS Commissioner Doug Shulman and all those Congressional deficit hawks should do the patriotic thing, put some big money on the game and, should they win, report it on their 2011 taxes.

We fellow taxpayers and the U.S. Treasury would appreciate it!

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