Michael “The Grinder” Mizrachi is a well known tournament poker player. The Florida resident has nearly $7 million in career earnings. He also has tax troubles.
Mr. Mizrachi had a nearly $340,000 tax lien slapped on him. A condominium he co-owned with his brother Robert (also a professional poker player) was foreclosed. The South Florida Sun-Sentinel reports that his Miramar, Florida home has also been foreclosed and will be sold this coming week.
So who does Mr. Mizrachi blame? His accountant.
He told the Sun-Sentinel that his old accountant had done a bad job and he’s hired a better one. (For the record, Mr. Mizrachi is not and has not been a client of mine.)
One of the things I tell my clients who are professional gamblers is to set aside at least one-third of what they make for taxes. (If you live in a high-tax jurisdiction such as New York City, the total tax bite can now exceed 50%.) It’s possible, of course, that Mr. Mizrachi’s old accountant did do a poor job. I’m glad to see that Mr. Mizrachi is working on resolving his IRS issues. “I’m working on [settling the liens],” he told the Sun-Sentinel. At least Mr. Mizrachi doesn’t have to worry about state income taxes.
Still, this is a cautionary tale for the young professional gamblers. Pay your taxes and set aside money as you earn it to do so. If you don’t, you will have tax troubles, and tax troubles tend to multiply.