35 Miss. Code R. § 3-11-22-110
Footnote:
* Proceeds are reduced by the wager (entry fee paid).
* If the entry fee is paid by the participant, only a W2G can be issued (tournament contributions by the company are irrelevant).
* Reporting and withholding is not triggered until the participant cashed out (final round).
* For reporting and withholding requirements under the IRC on gambling winnings of non resident aliens, see instructions to IRS Form 1042S and IRS Publication 515 or any replacement thereof The gaming establishment should substitute a 1042S for the W2G or 1099 MISC.
Examples:
* Patron pays tournament entry fee and wins satellite tournament. Patron receives no cash but does move on to next round. W2G reporting and withholding is only triggered when patron cashes out. The reportable amount is reduced by the entry fee (subject to above flowchart).
* Patron pays tournament entry fee and wins tournament. Patron receives no cash but does receive a paid (comp'd) entry fee to a third party tournament. Patron gets a W2G for the value of the comp reduced by the original paid entry fee. Gaming establishments may have to gross up the W2G for Mississippi withholding tax purposes.
* Gaming establishment comps a tournament entry fee for a patron. A 1099 MISC must be issued for any payout of $600 or more. The reportable amount is not reduced by the comp'd entry fee.
35 Miss. Code. R. § 3-11-22-110