From my understanding and relating this to some information posted on alt.vacation.las-vegas, the cumulation of pays up to $1200 would not be taxable on the vouchers or TITO systems. Reason being, as someone already said each voucher is, like a dollar bill an anonomous receipt for money owed from the machine. I would imagine that they would be handled in the same way as currency. If you turned in $10,000.00 worth of them you would probably have a Tresury Dept. form filed pursuant to investigation of money laundering activities. If you have a number of these that add up to the $1200 you would probably not have a W2G filed. Also if you had a single ticket for $1200 you might not get the W2G as there is no way to know if you put in 12 $100 bills to get that voucher etc. The casino would thus, probably, still set the machines so that such single HITS would be hand pay so that paperwork can be filed.

There was mention of the next evolution of the system where they would use your slot card to issue credits etc. You would take your card to a cashier and they would pay you the balance owed. In a system like this data is kept on the casinos computers. With your card inserted there would be records of how much you put in and how much was paid. If this was the only way to get your money out of the machine there would definately be records where they can subtract cash in from pay out and determine all your winnings. Thus you MIGHT, as one person pointed out, find that the IRS and States will tax you on every nickle that you win. The casinos could be required to report to the taxing authorities all wins at the end of the year.

In a state, like here in Illinois, where you have to pay taxes on your winnings whether you had losses or not you can bet that gaming regs will soon require such reporting. They are already taxing the casinos at 75%. When that tax increase proves not to increase revenues as expected, due to gambling dollars going to Iowa and Indiana, where do you think they will go to get money from next.

I may be overly pessimistic but I can envision a day when in mid January states like Illinois will send you a statement for the taxes you owe from all your $20, $50, $100 payouts all added up. Those who say that deduct your losses??? In Illinois, like I said, I understand that it is TOUGH. Losses are deductable up to winning for IRS but not in Illinois. I don't know how it is done in other states but if it becomes a nice source for revenue for a state you can bet some politician will work it into law.