SECTION 2. FACTUAL
Internal Revenue Bulletin 2007-36 · 2026-10-03 edition · updated 2026-10-04 · United States
BACKGROUND
A business taxpayer (“poker tournament sponsor”) may sponsor a poker tournament, charging an entry fee and a “buy-in” fee for each participant. In exchange for the fees, each participant receives a set of poker chips with a nominal face value for use in the specific poker tournament. The poker tournament sponsor pays amounts, which exceed a participant’s fees by $5,000, to a certain number of tournament winner(s), out of a pool comprised of all the participants’ fees.
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